True or false?! 💸 Sending money abroad used to cost 15%, now it’s 5%, and tomorrow it could be 0.01%, largely thanks to stablecoins.
In the past, sending $100 to family overseas could result in losing $10 or $15 in intermediary fees. 😲
Today, if a migrant worker plays their cards right, they can manage to send money for an average of $5 or $6 in fees through a specialized intermediary (and this also depends on the country they are sending money to) 🙂
Using a bank has always been out of the question for small amounts: in the United States, the average cost of an international transfer is $44*. It’s impossible to send $100 at that price. 😶
Thanks to stablecoins (USDT, USDC, etc.), this fee could drop further, to between $1 and $3, depending on the network used 😊
If they’re really interested, using a Layer 2 solution could allow them to spend only a few cents on the transfer itself 😎
If their money is in Bitcoin, they could also use the Lightning Network and pay minimal fees.
Imagine, these “remittances” amount to between $500 and $700 billion every year, three times the total of global humanitarian aid.
That’s between $40 and $70 billion in fees annually that line the pockets of intermediaries who are becoming less and less useful in a world of peer-to-peer exchangeable currencies. This could mean billions of dollars more received or kept by these same migrant workers. 🌈
The United Nations has long pursued the goal of reducing financial intermediary fees. This is even the target of a Sustainable Development Goal, Goal 10.C, which states: "By 2030, reduce to less than 3% the transaction costs of migrant remittances and eliminate remittance corridors with costs higher than 5%." 😓
However, the United Nations did not anticipate the impact of stablecoins and cryptocurrencies, which could cut these targets by tenfold.
👩🎓👨🎓 The Blockchain for Good will soon organize a call for scientific communication and will focus, with resources, on the emergence of this global phenomenon that some are beginning to document, such as Chainalysis, Andreessen Horowitz, Circle, Visa, etc.
👉 If you’re interested, engage with this post, and when we’re ready, we’ll add a comment to notify you of the launch of this initiative!
Source 1: State of Crypto Report 2024: New data on swing states, stablecoins, AI, builder energy, and more Daren Matsuoka, Robert Hackett, Eddy Lazzarin https://lnkd.in/dWeH5THe
Source 2: Whitepapers - September 12, 2024 - Nic Carter Stablecoins: The Emerging Market Story https://lnkd.in/emSMKZJD