The Revolutionary Impact of Bitcoin and Ethereum on Overseas Remittance Fees

On April 5th, it was reported that when Americans use traditional financial systems to send money to their families and friends overseas, they incur an annual remittance fee of over 12 billion US dollars. However, according to research by Coinbase, a cryptocurrency exchange in the United States, the cost of overseas remittances using Bitcoin and Ethereum has decreased by 96.7%.

Coinbase: Compared to traditional financial systems, the cost of using cryptocurrency for overseas remittances is extremely low and fast

In recent years, traditional financial institutions have charged Americans an annual remittance fee of over 12 billion US dollars to send money to their loved ones overseas. However, due to the emergence of cryptocurrencies such as Bitcoin and Ethereum, in-depth research by Coinbase indicates that the cost of overseas remittances using these digital currencies has decreased by 96.7%. In this article, we will explore how Bitcoin and Ethereum are revolutionizing the way we send money overseas, and how they are transforming the world of finance.

What are Bitcoin and Ethereum?

Before delving into the world of overseas remittance using Bitcoin and Ethereum, it is important to understand what these digital currencies are. Bitcoin and Ethereum are decentralized digital currencies created on a blockchain technology platform. While they share a lot of similarities, Ethereum is more than just a digital currency; it is a platform that enables developers to build decentralized applications using its blockchain technology.
Bitcoin and Ethereum operate on a peer-to-peer network, removing the need for intermediaries such as banks. Transactions are verified in seconds by a network of users worldwide without going through any central authority. This process ensures a secure, fast and cost-effective transaction compared to traditional financial institutions.

The High Cost of Traditional Overseas Remittance Systems

Traditional financial institutions have created a lucrative revenue model through their overseas remittance systems, charging exorbitant fees and incurring hidden costs when people send money overseas. According to a 2018 report by the World Bank, over $689 billion was sent globally in remittances, with over $30 billion being charged in transaction fees. In the United States alone, over $150 billion is sent annually in remittances, with an average cost of 7% per transaction, which amounts to $12 billion in fees paid annually by Americans.
The high cost of traditional overseas remittance systems has proven to be a burden on the people who send money abroad. Sending money to your loved ones should be simple without worrying about high transaction fees.

The Advantages of Bitcoin and Ethereum for Overseas Remittance

Bitcoin and Ethereum are redefining the way we send money overseas through their cost-effective, secure and fast transactions. Their advantages include:

Lower Transaction Fees

Using Bitcoin and Ethereum reduces the cost of overseas remittance, as they do not rely on intermediaries such as banks to facilitate the transaction. The cost of a Bitcoin transaction averages at $0.50, while Ethereum averages at $0.05. Compared to traditional financial institutions’ average transaction fee of 7%, Bitcoin and Ethereum transactions are significantly cheaper and transparent.

Fast and Secure Transactions

Sending money internationally using traditional financial institutions can take up to five business days for the transaction to be completed. Using Bitcoin and Ethereum, transactions are completed within minutes, allowing instant access to transferred funds. Furthermore, cryptography secures Bitcoin and Ethereum transactions, which makes them immune to fraud.

How to Use Bitcoin and Ethereum to Send Money Overseas

Using Bitcoin and Ethereum to send money overseas is a simple three-step process:

Convert your currency to Bitcoin or Ethereum

The first step in sending money overseas is to convert your local currency to Bitcoin or Ethereum using a cryptocurrency exchange such as Coinbase, Kraken, or Binance.

Send Bitcoin or Ethereum to the receiver’s wallet

Once you have converted your currency to Bitcoin or Ethereum, you can easily send it to the receiver’s digital wallet. The receiver will then be able to convert the digital currency back to their local currency.

The receiver can convert Bitcoin or Ethereum to their local currency

Once the receiver has received the digital currency, they can convert it to their local currency using a cryptocurrency exchange. The cryptocurrency exchange will then transfer the funds to the receiver’s bank account.

Conclusion

Overseas remittance using Bitcoin and Ethereum is revolutionizing the traditional financial industry, offering secure, cost-effective, and fast transactions. The advantages of using Bitcoin and Ethereum are that they eliminate the need for intermediaries, reduce the cost of transactions, and offer fast and secure transfers. Traditional financial institutions have created a lucrative revenue stream through their high transaction fees, putting a burden on Americans who send money overseas. By switching to Bitcoin and Ethereum, people can save money and enjoy simple and secure transactions.

FAQs

1. Are there any hidden costs when using Bitcoin and Ethereum to send money overseas?
No, Bitcoin and Ethereum transactions are highly transparent by design, meaning that there are no hidden costs.
2. What are the disadvantages of using Bitcoin and Ethereum for overseas remittance?
Bitcoin and Ethereum prices can be highly volatile, so the value of a transaction can be unpredictable. Additionally, some exchanges charge additional fees for converting cryptocurrencies to local currencies.
3. Can someone without any cryptocurrency knowledge use Bitcoin and Ethereum for overseas remittance?
Yes, several user-friendly cryptocurrency exchanges allow users to easily convert their currencies to Bitcoin and Ethereum and then send it to the receiver’s digital wallet.