How Stablecoins & ERC-20 Tokens Are an Efficient Mover of Money Across Borders

Stablecoins help bridge the gap between fiat currency and crypto. Businesses can quickly move money without crypto’s usual price volatility, while still conducting secure, low-cost financial transactions without centralized intermediaries like governments or banks. Ahead we’ll take a closer look at what makes stablecoins a leading option for cross-border crypto payments.

Background on stablecoins

Stablecoins are different from most other cryptos in that their price is tied (or “pegged”) to other assets such as dollars, euros, gold or even other cryptocurrencies. This means at any given time, one unit of a stablecoin should be redeemable for an equivalent amount of the underlying asset. Stablecoins are not mined or minted like other cryptocurrencies. Rather, they’re issued by organizations who maintain the coin’s value by holding an equal amount of assets on reserve. These reserves, typically held in U.S. bank accounts, are routinely audited by independent accounting firms, with the results posted on the issuer’s website for all to see. In the case of fiat-backed stablecoins, the amount in circulation is never to exceed the amount of dollars or euros held in reserve.

Stablecoins usually don’t draw the amount of media coverage as more volatile cryptocurrencies like Bitcoin or Ether, but stablecoins actually make up a sizable portion of the total cryptocurrency market cap. Two of the top five most valuable cryptocurrencies are stablecoins, Tether (USDT) and USD Coin (USDC), with a combined market cap of over $100 billion as of late 2022. One reason stablecoins are so popular is because they offer the versatility of crypto with the price stability of fiat. Stablecoins’ lack of volatility and widespread acceptance makes them one of the best types of crypto for cross-border payments and payouts.

Benefits of using crypto for global pay outs and mass payments

Stablecoins are one of the better options for making global payments with crypto, but most cryptocurrencies also offer distinct advantages versus the traditional banking system. Making or accepting cross-border payments with crypto is faster and cheaper than the usual methods, and involves less risk. Some of the benefits of using crypto for global payments include:

  • Accept and send payments from anywhere in the world
  • Near instantaneous transfers
  • No international currency inflation risk
  • No banking or government intermediaries (no counterparty risk)
  • No excessive fees

Stablecoin and ERC-20 token use cases in

Stablecoins’ price stability makes them a natural fit for a variety of payment functions on either side of the transaction. This includes everything from vendor invoicing to managing crypto payrolls.

Payroll and bonus payments

Thanks to their predictable value, paying employees’ regular salaries or bonuses with stablecoins, either in-full or as a portion of payment, is incredibly easy. Crypto payroll solutions are especially beneficial when paying employees overseas, as cross-border payments using traditional banking methods can be costly and inefficient. Making cross-border payments in crypto allows for near real-time settlement while reducing transaction costs.

Partners and vendors

Settle accounts with partners around the world or pay vendors with crypto quickly and easily without ever having to touch crypto, even overseas, with more than 225 countries supported.

Customer cash-outs  

Digital platforms attract creators and players from across the globe, making a border-less payouts solution like crypto an ideal use-case. Without the need for central banks, platforms can pay out in stablecoins to create the stickiness and foster growth of expanding communities.

Marketplace and affiliate settlements

Stablecoins are an ideal solution to pay out sellers and affiliates at scale. Sellers and affiliates can choose their preferred stablecoin and receive earnings straight to their wallet, regardless of their banking situation or location.

Rewards, rebates and refunds for customers

Modern brands looking for new ways to connect with their customers choose crypto and stablecoins. Paying out rewards, rebates or refunds in stablecoins can incentivize customers and efficiently transfer value, no matter their location. Learn more about

How to start accepting and sending stablecoins across borders

Even with little to no knowledge about crypto, it is easier than you think to start accepting and sending crypto payments across borders. BitPay crypto payroll and payouts solution, BitPay Send, is a secure, turn-key way to send crypto to anyone, anywhere in the world.

Step 1: Create your BitPay business account

Get in touch with BitPay to get your account set up. It takes minutes to create an account and is free to start.

Step 2: Fund your payments in fiat

From the BitPay business dashboard, you can fund payments using fiat, enter recipient details and track your payments.

Step 3: BitPay converts fiat to crypto

BitPay quickly converts your fiat payout to the recipient’s preferred cryptocurrency and sends it to their wallet address.

Step 4: Recipient receives stablecoins straight to their wallet

The recipient receives their stablecoins directly to their wallet and can spend, swap or transfer instantly.

Partnering with a trusted payments processing partner like BitPay ensures your payroll, mass payments and global payouts are fast, accurate and secure. BitPay can have you set up to send and receive cross-border crypto payments in mere hours. No headaches, no crypto knowledge required.