Top U.S. cryptocurrency exchange Coinbase estimates that Americans might save several billion dollars annually in transfers by switching to digital assets.
According to a new blog post by Coinbase, the average remittance fee charged by banks in the United States is 10.8 percent, while that charged by money transfer companies is 6.2 percent and that charged by the post office is 5.5 percent.
Over $12 billion in fees are paid annually by Americans to send money abroad to loved ones. These funds are a lifeline for unbanked populations, allowing them to pay for necessities like food, medicine, and schooling.
However, the international transfer procedure is startlingly time-consuming and costly. Cryptocurrency facilitates instant and affordable international money transfers, easing the financial strain on communities that seek to aid members of their extended family or friend network living overseas.
According to Coinbase, Americans already spend millions of dollars annually on remittance costs. Cryptocurrency has the potential to drastically cut this cost.
Sending money overseas with a cryptocurrency like Bitcoin or Ethereum will save you up to 96.7 percent compared to the existing system. The average cost to send Bitcoin or Ethereum from one wallet to another is $1.50 and $0.75, respectively. The data presents itself clearly. It is possible to do away with these costs.
It’s more than simply monetary value. A remittance might take anywhere from one to ten days, which is a huge inconvenience. Additionally, cryptocurrency transactions often take no more than 10 minutes.
According to Coinbase research, in 2017 U.S. citizens sent $52 billion to Mexico and $67 billion to Asia via international wire transfers. Nearly ninety-five percent of the remittances to Mexico last year were processed by Americans.