A new choice for international transfers: Why are more and more people choosing cryptocurrency remittances

Pain Points of Traditional Remittance

Want to send money to family and friends overseas? If you’ve used bank transfers, you know how complicated it can be. A cross-border transfer of £1000 can incur a fee of £10-15, and it takes several business days to process. Some payment tech platforms have lowered costs (£1.50 to £4.66), but not everyone can use them easily.

The real issue is—international remittances involve multiple fee-charging steps. Your bank charges a fee, intermediary banks charge a fee, the recipient’s bank charges a fee, plus exchange rate differences. On average, banks’ simple fees eat up 2%-4% of the transfer amount. Systems like SWIFT facilitate funds transfer between multiple banks, with each bank adding extra processing fees. The result: the less you send, the less the recipient gets.

How Blockchain Changes the Game

Cryptocurrencies leverage technology to cut through these middlemen. In May 2010, someone bought two pizzas with 10,000 Bitcoins, worth only $25 at the time. If they knew this digital asset would become a mainstream method for international remittances, they might regret that purchase.

The logic of crypto transfers is simple: peer-to-peer direct transfer, blockchain accounting, no bank involvement. What does this mean?

• Cost drops dramatically: a USDC transfer might cost only $0.008869, compared to traditional remittance fees of $10-12, saving 99%
• Incredible speed: same transfer completed in 2 seconds, while traditional methods take 2-5 business days
• No regional restrictions: areas with underdeveloped banking infrastructure, conflict zones, or collapsing economies—if there’s internet, transfers can still happen

Who Uses Cryptocurrency for Cross-Border Remittances

A boon for migrant workers

People working in the UAE or Singapore often send money to family in India, the Philippines, Nigeria. Traditional routes take 2-5 days and deduct 3-10% in fees. But with blockchain (like Solana network), the average transaction cost is just $0.00025, with confirmation in 5 seconds.

A lifeline in restricted regions

Venezuelans face hyperinflation and use Bitcoin and stablecoins to protect assets. In September 2021, El Salvador officially adopted Bitcoin as legal tender, aiming to help ordinary citizens bypass financial hardships.

A new channel for emergency aid

During the Ukraine conflict, traditional banking systems collapsed. Refugees and locals used cryptocurrencies for quick emergency assistance. Ethereum founder Vitalik once donated 500 trillion Shiba Inu tokens (SHIB), worth $1.2 billion at the time, to India COVID relief funds—funds that arrived instantly via blockchain without any middlemen approval.

Hope for the unbanked

There are still 1.7 billion people worldwide without banking access, many due to lack of ID. Traditional platforms require strict KYC verification, but some decentralized exchanges have looser identity requirements, enabling these people to also perform international transfers.

How to Do It Step-by-Step

Step 1: Prepare Wallet and Account

Choose a reliable wallet platform, set up a recovery phrase (crucial—if lost, can’t recover), enable two-factor authentication. Wallets come in two types:

• Custodial Wallets: platform holds your private keys, easy to operate but depend on the platform
• Self-custody Wallets: hardware or software wallets, you control everything but must keep your keys safe

Step 2: Convert Fiat to Cryptocurrency

Find a reputable platform (make sure it supports your local fiat currency), complete identity verification, then buy using bank account or debit card. Remember to account for transaction fees.

Step 3: Confirm Recipient Address

This step is critical—ensure the recipient’s wallet address is correct. Blockchain transactions are irreversible; a single wrong character means permanent loss, and no customer service can help recover it.

Step 4: Initiate Transfer

Click “Send” or “Transfer,” paste the recipient’s address, enter the amount. The system will show network fees; if urgent, you can pay higher fees to speed up processing. Confirm details and click send. The transaction completes within minutes.

Step 5: Notify the Recipient

Share the transaction ID and confirmation link so the recipient can track the funds.

Stablecoins vs Volatile Coins

If you’re worried about crypto price fluctuations, choosing stablecoins (USDT, USDC, etc.) is the safest. These are pegged 1:1 to USD, with stable prices. As of September this year, the market cap of fiat-backed stablecoins reached $161.2 billion. Although down from the peak of $181.7 billion in 2021, it still underscores their importance in international transfers.

If you believe in crypto appreciation potential, you can also transfer Bitcoin or other coins, but you’ll need to accept the risk of price volatility.

Comparison: Actual Costs of Different Transfer Methods

Important Details to Note

Safety Habits

• Double-check addresses—more than once; using QR codes is safer
• Choose reputable platforms
• Keep wallet software updated—avoid vulnerabilities
• Strong passwords + 2FA are standard

Common Issue Handling

• Network congestion causing delays? Increase Gas fee priority
• Worried about volatility? Use stablecoins
• Address entered incorrectly? Contact the recipient immediately, see if you can send again
• Uncertain about local regulations? Check in advance or consult professionals

Don’t Ignore Tax Issues

Different countries treat crypto transfers differently:

• USA: IRS considers cryptocurrencies as assets; gains are subject to capital gains tax
• UK: Tax applies only if exceeding annual exemption
• Japan: Progressive taxation based on income type
• Singapore: No capital gains tax, but exchanges may be taxed as businesses
• UAE: No personal income tax, crypto-friendly

In any case, keep all transaction records. It’s recommended to consult local tax professionals to ensure compliance.

Macro Perspective: Cryptocurrency as a Global Asset

By November 2024, Bitcoin’s market cap approaches $2 trillion, surpassing silver’s $1.7 trillion. What does this indicate? That cryptocurrencies are evolving from niche assets into an integral part of the global financial system.

International remittance is never the only use case for crypto, but it is the most direct reflection of value. As more people realize how cheap and fast cross-border transfers can be, the monopoly of traditional finance begins to shake.

Whether you’re a migrant worker abroad, a refugee surviving chaos, or an ordinary person wanting to help overseas friends and family, crypto offers a better way. The key is learning to use it correctly and safely.