Stablecoin Remittances Show No Cost Edge in Banca d'Italia Test

Regarding transfer speed, onchain settlement was fast, but end-to-end times varied, especially when you add local payment infrastructure.

In brief, the paper was not very excited about stablecoins and the potential value to transfers and payments while worrying about adding AML/CFT risk to the process.

Local instant payment systems can help, and direct spending via stablecoins could drive value for users.

In reviewing the report, Movement CEO Torab Torabi says the real friction in cross-border payments comes from the legacy financial infrastructure connecting to it.

“While some are positioning the Bank of Italy findings in a negative light for stablecoins, this is the data set our industry needed. The Bank of Italy’s numbers show the blockchain leg of these transfers cost a fraction of a percent, while exchange fees, FX spreads, and banking rails did almost all the damage in taking money from the end user. That’s not a stablecoin problem. It’s proof the bottleneck was never block times or throughput, but rather the last mile of compliant on/off-ramps and integration with domestic payment systems. The settlement layer has proven to work from a central bank across ten corridors. If the industry takes this seriously, the next wave of cost reduction won’t come from faster chains, it’ll come from fixing the incumbent systems around them that are causing the most friction.”