Are crypto cross-border payments the future of transactions?

Cryptocurrency payments – or transactions that are executed through blockchain technology – are being used across sectors to send funds across the world. These payments are known as cross-border payments as they are utilising crypto to facilitate payments across country borders.

The first step in a cross-border crypto payment is to convert the fiat currency of the sender’s country to a cryptocurrency. This can be a cryptocurrency asset of the sender’s choice, depending on local regulations. To do this, they use a platform or blockchain project as an on-ramp and is done using a bank transfer or debit or credit card. From there, the cryptocurrency can be held in a secure hot (online) or cold (offline hardware) wallet until the sender is ready to transfer the crypto assets.

When ready, the sender uses the recipient’s cryptocurrency wallet address to send the funds. Similar to a traditional bank address, the wallet address is a unique set of characters associated with their wallet only. Unlike banking, if a mistake is made, there is no room to get the funds back, so entering the correct wallet address is critical. Once sent, the recipient should receive the crypto funds immediately and has the choice to keep the crypto and store is securely, convert the crypto assets to fiat currency in their country through an off-ramp in their country, or convert the digital asset to another cryptocurrency such as a stablecoin.

Is cryptocurrency better than fiat for cross-border payments?

There are several reasons why people are looking to cryptocurrencies over fiat for sending payments across countries.

It’s cheaper

Sending money across countries is often seen with remittance payments by people working in foreign countries and sending money back home. This makes the least costly method of sending money home the most appealing. In 2020, the World Bank estimated that remittance payments sent through traditional fiat banks are charged an average fee of 6.75%, a significant amount for sending money to another country. While it’s decreased from the whopping 9.75% average fee charged back in 2009, cryptocurrencies payment fees are more appealing as on-ramp platforms charge significantly less than traditional banks.

It’s faster

Currently, it takes an average of between three to five business days for funds to arrive from sender to recipient through traditional banking. Cryptocurrency payments, facilitated through blockchain networks, is generally immediately, slashing the time taken to receive the money significantly.

It could lead to more global financial security

According to research from global banking firm Deloitte, blockchain transactions can be rich in data from sender to recipient, even though the information is encrypted. With most on-ramps having know-your-customer (KYC) and anti-money laundering (AML) protocols in place, this information could help regulate the financial market across the globe.

Blockchain offers financial access to the unbanked

According to research, there is a massive part of the world that remains unbanked. With an estimated 1.7 billion people without access to a bank account, a massive part of the global adult population has no access to online financial services. This makes sending money digitally to another country an impossibility for some. Cryptocurrency payments help facilitate this as a feature to those without banks, increasing the global financial access overall.

The challenges of cryptocurrencies for global payments

While cryptocurrencies offer numerous benefits over traditional financial systems, there are still a few hurdles to overcome before we see wider adoption in the industry.

The complexity of crypto

Cryptocurrency is still seen widely as a complicated industry, with many perceiving the space as technical and difficult to understand. As more are given insight into how to use cryptocurrencies (something that can be done AND taught through smart phones), and as more users start taking advantage of the technology, we will likely see a spike in the uptake of crypto payments.

Gas and transaction fees

Scalability on some platforms, especially decentralised exchanges and protocols with little liquidity, leads to rising fees for transfers. This is especially so in times of increased demand, with Ethereum users particularly suffering with high gas fees. More cryptocurrencies are looking to resolve issues of scalability as well as platforms that facilitate payments.


Cryptocurrency payments – both to send and to receive – rely on countries that are not averse to the crypto industry. With more countries looking to regulate the space, we’re likely going to see more legislation that will help facilitate crypto payments, but this is still emerging across the globe.

Related Articles

Top Five Crypto Red Flags on Social Media

Some scams are easy to see, but others might look like a worthwhile investment opportunity. Here are some crypto red flags to look out for.

Highest Taxed Countries for Crypto Investors

Find out the countries where you'll pay the most tax if you're trading, holding, buying or selling cryptocurrencies.

The Importance of Understanding Social Engineering Attacks

Advancements in artificial intelligence and communication technologies make it difficult to discern what's real and what's a scam.

Kate’s Data Breach Sparks Urgent Call for Enhanced Security Measures

After Kate Middleton's alleged data incident and possible internal attack at the London Clinic, there's a clear need for security in cyber...

See All