Topic: Bitcoin's Role in Global Remittances: Can it Disrupt Traditional Money Transfers (Read 297 times)

Robust means strong and user-friendly is different from it but both must still be needed in order to achieve more success. Apart from it we also need it to be more accessible, especially on those farther areas where they lack on electricity, internet and establishments, as I think most people there rely often on remittances and I heard they travel by a far because of their difficulties just like what I listed above earlier.

What we are talking here must still be part of the traditional money transfer but Bitcoin can also/still operate on its own and it can actually disrupt them easily if it or we wanted too. In fact it happened already for some people or places.

LN caused issues for el salvador.. please update your news feed.. your quoting old crap.. LN failed el salvador..
el salvador moved over to a centralised exchange(alphapoint) to manage crypto payments for its citizens. totally bypassing any blockchain transactions and bitcoin and even LN, it turned into them deciding on relying on a centralised mySQL database

https://alphapoint.com/blog/case-study-chivo/

yep, when LN failed el salv in autumn/winter 2021 and el salv had to shift in 2022, they shifted to alphapoint centralised exchange to manage the populations funds

Due to the pseudonymous nature of Bitcoin and other cryptocurrencies, it will always be hard to properly measure. However, the volume of Bitcoin and cryptocurrency as a whole serves as a metric of payments that otherwise would have been mostly/all within the monetary/banking system if Bitcoin and the cryptocurrency sector did not exist.

Here is some data regarding Lightning Network specifically though, and its impact in El Salvador:
"With Bitcoin as $1 trillion asset, Lightning’s network capacity has grown exponentially and is now around $150 million. Bitcoin’s Lightning Network payments app such as Chivo wallet or Strike are providing such innovative solutions for remittances."
Source: A lightning disruption of remittance costs: a silver lining for entrepreneurship during a crisis?

Here is also some data regarding Binance, who has enabled over $26b in peer-to-peer remittances between 2022 and 2024:
"Binance, the largest crypto exchange by trading volume, said its users collectively transferred $26 billion in peer-to-peer remittances between 2022 and 2024 — saving $1.75 billion in remittance fees, according to a Jan. 21 statement shared with CryptoSlate."
Source: Binance enabled $26 billion in remittances via crypto over 2 years, saving users $1.75 billion

Here's also an additional article right from the NASAQ which concludes that disruption will continue and also includes some interesting information about the Philippines:
"The Philippines seems to be the market most quickly adopting blockchain-based money transfer solutions. Sixty-nine percent of Filipinos have no bank account or credit card, according to the World Bank."
Source: Remittance Industry Ripe for Blockchain Disruption

It's not theory. It's happening.

Bitcoin is an alternative to banks especially for the unbanked or the underbanked but Bitcoin does not take all users from banks. There are people who choose banks for their fund transfers and there are people who pick Bitcoin for their fund transactions through Bitcoin blockchain.

It's same with global remittance market, it's opened for banks and Bitcoin as well as alternate cryptocurrencies and other methods. It's not time for Bitcoin to totally replace banks and I have my strong belief that Bitcoin will never completely replace banks nationally or globally. There are options and people have freedom to make choices, so Bitcoin has no power to mandate everyone using it for either personal or business purposes.

It should be an alternative, imo.
Once it would be seen (and already is, to some degree) as a power that accumulates said dominance, it would not be taken lightly..

Is it not already disrupting the global remittance market?

Sending remittances through an intermediary is a costly affair. Very often banks charge a commission which is a huge sum of money in terms of its monetary value. Bitcoin can surely disrupt this entire market with ease. However, more education and awareness is necessary here.

This is one of the reasons why banks do not like Bitcoin at all. Because here you control your own money and you choose what to do with that. So Bitcoin should dominate the financial and global remittance market.

PayPal has the highest restrictive features I have ever come across so far when it's come to the remittance industry, it's hard to receive money from PayPal account across borders with the following reasons if;

_Sender transferring directly from bank card to receivers mail address
_Sender has to send from PayPal balance before the receiver confirms transactions

In most cases, all these conditions must be met but there is 100% certain that the payment would be reversible back to the sender for multiple reasons, wrong IP address and invalid mail address. Bitcoin the other way round, has less restrictive features than other remittance payment services, so long as the transaction fees are met and the wallet address is valid, that's a straight out way.

Why? Is it because of the transaction fees? But just like bitcoin, banks and other platforms also have transactions so I think in that sense they are just almost the same. Of course using bitcoin to send or receive will only be at its most convenience if the other party also knows how to use bitcoin otherwise it would serve as a complication because if they do not know how to handle their bitcoins, you might get blamed. So if you are to make any transaction make sure that you aren't forcing anyone to start using bitcoin just to transact with you. It could lead to disasters.

Bitcoin is revolutionizing global remittances by offering faster, cheaper, and borderless money transfers. Its potential to disrupt traditional methods empowers individuals with greater financial freedom. http://36crypto.com/

Can you provide data showing that bitcoin/cryptocurrency is disrupting the traditional remittance industry?

In my opinion, bitcoin could threaten the traditional form of cross-border money transfer as bitcoin/cryptocurrency becomes more popular and legal globally in the future. But right now, that hasn't happened yet because bitcoin isn't really widely used globally, there are still many countries and regions that have only heard of it but never used it.

Also, is Bitcoin really everyone's choice or do most use stablecoins or altcoins since Bitcoin clearly can't outperform when used as a payment method? Bitcoin is good in terms of decentralization but when it comes to transaction speed and fees, it cannot compare to the rest of the crypto industry.

With the TPS of 3,3-7?
I would be happy to say you are right pal, but no. Not at the current state.

It's gradually taking its market share, and over the course of its life, I'm sure there is enough data to support that it's majorly disrupted this industry. I am sure anyone looking to transfer money internationally, or large quantities of money, opt to use Bitcoin or another form of blockchain asset in order to bypass fees incurred by traditional banks and such.

Bitcoin: future of remittances? Not just maybe, very likely. It's faster and cheaper than previous approaches. No intermediaries, banks, or delays. Working overseas allowed people to send money home without high fees or red tape. Traditional systems cannot match its efficiency. What about fees? Bitcoin transactions cost much less than Western Union or MoneyGram. As network congestion increases, fees may escalate. Small transfers may cost more in busy traffic

The elephant in the room is regulation. Authorities won't hand over financial flows to a decentralized system. They'll seek fees, restrictions, or bans to safeguard their interests. Bitcoin isn't going anywhere. Controlling it is practically impossible due to its decentralization. Bitcoin's strength is that once it becomes mainstream, people won't compare it to fiat currencies like USD. Instead, USD will be assessed against Bitcoin. Bitcoin could change how we value and transmit money globally once adoption and volatility stabilize through use cases and global integration. Traditional methods? They'll appear antiquated, clunky, and expensive

I personally feel that if we do international transactions in Bitcoin, then we will need less time and can do it very quickly and in the process of transaction, the cost will be much less than other currencies.  Hopefully Bitcoin will be the most popular currency in the world one day.

This may be more relatable and applicable to international remittance as bitcoin save us the stress and hassle of conversion and the hitch of variation of accounts, currently bitcoin is breaking barriers at international levels for funds transfer such that values are maintained amidst the variation of currency values,  but a better adoption will be when there's more local adoptions.

While traditional methods can be slow that it may takes days especially with international transfers and also comes with expensive transaction fees, unlike with bitcoin, it’s more quick, most likely within minutes, plus lower transaction fees especially for larger amounts. When it comes to accessibility, as long as you have good internet connection, you can easily transact with bitcoin without relying on banks or any financial institution in which this is a must if you are going on a traditional money transfer. So you’ll be the one to judge OP if bitcoin will be able to disrupt traditional money transfers or not.

BTC is a great option for cross-border payments. Like i always say, it may not be the best currency to spend in the coffee shop or when you are buying groceries worth just a few dollars, but if you are spending or sending a lot of money, it is a great option.

However, if tx fees are high when you want to make your tx, it could be a barrier, but if you are someone who consolidates your small inputs and use coin control, you may be able to save up on fees when you want to make your transaction.

In my opinion I really don't see that as a major problem. The whole concept is basically most dependent on the idea of acceptance. If both parties involved in a transaction are ok with. Making use of bitcoin as both payment and receivable methods for either case then they are good to go. The bitcoin network has one of the lowest fees compared to many other networks and it's most easy when you understand how fees work.

All these can still be indirectly related to some regional factors like if crypto is generally accepted or not. The only problem that I commonly see could be dynamic rates and it's very much resolvealble as long as both parties agree with it.

Not to mention, bitcoin's volatility is also an issue to consider when using bitcoin as a currency or a method of transferring money. Bitcoin is very sensitive and even a small news can cause Bitcoin price to dump immediately, and while waiting for the transaction to be confirmed, our money can also lose value due to the drop in bitcoin price and not everyone is comfortable with that.

I agree with you, bitcoin is not a competitor to traditional forms of money transfer nor is it a perfect alternative.



When it comes to remittances and payments, what people care about is transaction speed and fees, and it is clear that altcoins outperform bitcoin when it comes to domestic and international remittances and payments.

Bitcoin can be a great option for remittances especially for countries that suffer from high inflation, are economically or politically unstable, etc.
Bitcoin is very popular in Turkey for example where many people own bitcoin and stablecoins because of crazy inflation that can exceed 50%.

Bitcoin will coexist with everything that already is there.
It's an alternative, not a way to destroy everything else and inject itself into the system to refurbish it.

I don't think so.
In as much as Bitcoin has better financial benefits, and offers a better secure transaction, it still won't overtake what remittance has put in place due to the reasons I explained below.


Of course, I think Bitcoin has that primary advantage when it comes to border and international transactions. The limit to which people across the globe can send money varies from one country to another. Too many laws and restrictions in place can even leave a transferred money pending for a very long period of time, which in most cases, the sender or receiver might be needed for some questioning. So, I think Bitcoin helps to break this barrier in some way.

And as for the barrier or limiting factor to this idea, well I think it has to do with digital illiteracy. Not everyone actually knows or understand how Bitcoin works, or how to perform a Bitcoin transaction. And government regulations can also be a factor though, but it will affect only those that have little knowledge on how to navigate their way around, because someone who understands these things well would definitely find another option.

I think there are two main barriers at this moment.

The first one is the lack of liquidity for the local currency to Bitcoin in most countries. Outside of the EUR / USD and some exceptions like the Argentine Peso (for historical reasons), there are often very few exchanges and with larger amounts you have to take into account at least 1-2% of slippage because of the lack of thickness of the order books in local currency.

The second one is the unpredictability of transaction fees. For remittances where sender and receiver convert local fiat into Bitcoin, however, Lightning is a good and cheap alternative. Altcoins like LTC can also help here but then the liquidity barrier is even higher or you have to take into account more "hops" in the process. And LN availability on local exchanges sometimes also is lacking.

Both barriers lead to significant costs, which can sum up to values similar to a Western Union transfer fee in many cases.

If Bitcoin was of course less volatile and it was more popular among "everyday people" to simply "own a Bitcoin account" (even if it's a CEX / centralized wallet account) then the first barrier would lose significance. But we're still not there.

Bitcoin blockchain and Bitcoin transactions are good for people who care about security, safety and privacy of their assets and transactions. If the main concern is transaction fee, Bitcoin blockchain is not the best choice.

It depends on main concern, people will have different choices and if any newbie still wonder why Bitcoin blockchain is good in security, let's read some documents.

How many Bitcoin confirmations is enough?

If you want cheap transaction fee, let's go with Ripple, Litecoin, Dogecoin and I personally are favorite with Litecoin and Dogecoin that are Proof of Work altcoins while Ripple is not.

Litecoin and Dogecoin blockchains are not secure like Bitcoin blockchain, but they're better than Ripple.

Big transactions, choose Bitcoin.
Small transactions, choose Litecoin or Dogecoin.
https://howmanyconfs.com/

They aren't slow and expensive, it's very cheap to send and receive money from any place to any place within minutes. Lots of people in my region use money transfer services. Btw Bitcoin is not a very good competitor in terms of speed and price because when transaction fees are high, Bitcoin fees can be more expensive than the fees of money transfer services and in terms of speed, Bitcoin sometimes need at least 1 hour because many companies don't accept transactions with lower than 6 confirmations. Btw altcoins like XRP and Litecoin are very fast and cheap solutions compared to Bitcoin. Bitcoin shines in decentralization.

This one provably would gonna happen since the same with other existing digital payments exist Bitcoin will coexist with current settings and became an alternative currency option to used by people. And we should be grateful with that since that means Bitcoin will not go anywhere and it will not create any conflicts since government would provably eliminate those things that is a huge threat on their financial system.

There's huge chance that in future we can use Bitcoin directly to pay anything we want on physical merchants near us. And its great to see the current developments happen with Bitcoin since we see that good adaption and recognition is already starting with many countries in the world.

Another challenge i think bitcoin faces is its volatility. The value of bitcoin can fluctuate widely in short periods making it unpredictable. For someone sending money to a family member abroad, this volatility could result in the recipient receiving an unexpected amount. Until bitcoin stabilizes or a solution for volatility is found, this could limit its effectiveness in the remittance sector

Yep, there may be cases in which you can buy something with BTC, but they wouldn't be official, per se, as the means of payment that is regulated.
But that's totally possible, and in the future, we may see more developments coming this way, in my opinion.
BTC wouldn't be used for small purchases, but for bigger ones - why not?

But bitcoin is not recognized as a currency and you need to convert bitcoin into fiat if you want to spend it. So if you are in an area without a bank or traditional services, you will also have difficulty spending bitcoin . Not to mention, bitcoin's volatility will also be a challenge, the value of your money can increase or decrease by 10%-20% if the market fluctuates . It would be a hassle if we used that money for our daily needs .

By the way, if we talk about global money transfer, I think we should mention cryptocurrencies instead of just bitcoin because any coin can do that . They are even faster and cheaper than bitcoin, and completely outperform traditional money transfer systems .

For bitcoin to truly become a go to solution for remittances, i think we need more robust infrastructure. This includes user friendly platforms for sending and receiving bitcoin as well as partnerships with local exchange services to make converting bitcoin to local currency easier. Without this kind of infrastructure, btc might remain inaccessible for many people who want to use it for cross boarder payments

has bitcoin not yet done that? a lot of people already use bitcoin when transacting with one another most especially when the transactions go from another country to another country if they had used centralized banks it would have taken days and would have cut a huge amount off of the money being sent
the barrier is lack of awareness that you can do this and more efficiently with bitcoin which is why not a lot of people are using bitcoin this way yet

What excites me about bitcoin is that it could provide financial access to people in underserved areas where traditional banking services are limited. With just a smartphone and an internet connection, anyone can send or receive bitcoin which could make remittances more inclusive for people in remote or unbanked regions

Two systems would just coexist with each other, that's my take on it.
Nothing wrong with that, not every country in the world would be blissful towards Bitcoin, even in the years to come.

Depends on when the money transferred has been used. But if the destination still end up to be converted to fiat and withdraw it to remittance centers or bank I guess those Bitcoin transaction cannot still effect the traditional money transfer since those institutions still benefiting for each transactions made by people.

And actually don't see any conflicting factor towards traditional money transfer since after all  people cannot use Bitcoin directly to buy goods or basic things they need since they still need to convert it to fiat so that could buy everything they want or need.

Yep. And it depends on how many times a person would need to do the transfers.
If it's a lot of times - Bitcoin may not be suited for the needs of said person, but if he needs big transfers of value and not too frequently - Bitcoin would be the choice.

In cross-border transactions, bitcoin is the best solution that can be used by people to send their money to other users more easily, securely, hassle-free, and with lower fees. But even so, each person may have their own options for cross-border transactions, some prefer to use paypal, bank transfers, or other payment platforms. The reasons can vary depending on how they understand bitcoin, because there are some people who don't really believe in bitcoin, or they think it's still complicated, or lack of knowledge, but usually it's about regulatory issues that make people reluctant to use bitcoin in their cross-border transactions.

Bitcoin blockchain provides more secure remittance method than traditional methods like bank transfers but it does not provide faster solution.

Bitcoin and traditional methods, future methods will exist together. Bitcoin won't kill traditional methods or future methods and other methods won't kill Bitcoin. It is a free society and world where people have freedom to choose their favorite methods and Bitcoin is one of their options. It can be most favorite for some people but it is not favorite choice with others.

The bullish case for Bitcoin.

When I was abroad working, I used to send money to my family back in my home country in Bitcoin. There were pros and cons, of course. But I realized that the features Bitcoin offers are optimized when large amounts are involved. Most especially if the remittance is going in or out of a sanctioned country or done by a sanctioned company or personalities, one can really exploit Bitcoin's design. It's global, borderless, censorship-resistant, seizure-resistant, and so on.

this question was asked over a decade ago.. and back then the answer was yes..
however the core devs messed with bitcoin just enough to change that answer to no.

core devs messed with bitcoin purely so they can have their sponsors of the messy alterations create subnetworks to steal the "remittance" business opportnities of bitcoin, for middlemen payment processors of subnetworks via their promotions that anyone sending under $1k should use a subnetwork and not the bitcoin mainnet.. the issue though, is these subnetworks are not made to be straightforward to self-setup, they are not bug free, nor be easy to be in self control of funding and remain viable. heck even the peg of mainnet currency to subnet units are not guaranteed, so alot of things have gone wrong with such a opportunity that existed over a decade ago

Remittances are a huge part of the global economy but traditional money transfer services can be slow and expensive. Bitcoin offers a faster and more cost effective alternative. Could bitcoin disrupt the remittance industry and become the go to solution for cross border payments? What are the potential for bitcoin to change the way we send money internationally and what barriers still stand in the way of its widespread adoption for remittances?