A new study by the Bank of Italy reveals that blockchain does not deliver lower costs than traditional payment networks for cross-border transfers, according to Cointelegraph market analysis. The research challenges common assumptions about cryptocurrency efficiency in remittances.
When researchers examined real-world stablecoin transfer mechanisms over various time periods and scenarios, they discovered that fiat-to-cryptocurrency conversion fees plus legacy infrastructure expenses dwarf any blockchain transaction costs or network charges associated with moving digital assets on distributed ledger protocols.
Payment networks built around traditional banking rails continue to incur significant operational overhead from correspondent banking relationships, compliance procedures like KYC/AML checks, and currency hedging arrangements. These institutional frictions often exceed the minimal technical costs for transferring value across blockchain networks using stablecoins as intermediaries.
The findings suggest that advocates promoting cryptocurrencies as cheaper remittance solutions overlook embedded expenses when converting between fiat currencies before transfers occur on any blockchain network whatsoever.
