The Stablecoin Sandwich: A Better Way to Move Money Across Borders

FF News

7 hours ago

Cross-border payments remain one of the most expensive and opaque aspects of international business. Fintech Finance reports that global corporations move $23.5 trillion across borders and pay an estimated $120bn in transaction fees annually. With slow settlement times, high FX fees, and complex compliance requirements, many companies are seeking faster and more transparent alternatives. What traditional cross-border payments get wrong
Despite living in an era of instant communication and cloud-based everything, cross-border payments are still burdened by outdated infrastructure. Much of the friction stems from reliance on legacy systems like SWIFT and correspondent banking networks, which introduce delays, fees, and opacity into every transaction. These systems were never designed for the speed and scale of today's global digital economy.
The list of issues that businesses face when making payments in 2025 is a long one: delays, hidden fees, poor FX rates, limited transparency, access issues, failed payments… These inefficiencies aren't just a nuisance. They create real business risk and operational drag. Consider the following scenarios: A tech firm in London needs to pay its developer team in Argentina weekly. FX volatility and delays mean developers are paid late, and the firm must overfund to account for slippage.
An online education platform in Singapore pays tutors across Africa. Bank coverage is patchy, and students complain when class schedules are affected by delayed payouts.
A French import/export company struggles to make timely supplier payments in Turkey due to capital controls and high intermediary costs.
In each of these cases, the core problem is the lack of a direct, efficient, and programmable value-transfer mechanism.
Enter, a modern-day solution, the 'stablecoin sandwich.' What is a stablecoin sandwich?
A stablecoin sandwich is a cross-border payment strategy that wraps a blockchain-based stablecoin transfer between two fiat currency conversions. The process begins by converting the sender's fiat currency (e.g., GBP) into a stablecoin (e.g., USDC). That stablecoin is transmitted over a fast, low-cost blockchain network, like Solana, before being converted back into the recipient's local fiat currency (e.g., INR).
Think of it as putting a stablecoin in the middle of two fiat 'slices', a transaction sandwich, crafted to avoid the sogginess of traditional banking rails. No one likes a soggy sandwich.
This structure isn't just more appetising, it's more efficient. It delivers: Faster settlement: Cross-border payments that typically take 2–5 days via SWIFT can now be completed in minutes or hours, depending on network choice.
Lower fees: While traditional correspondent banking can incur fees of 3–6% per transaction , stablecoin transfers often cost a fraction of that, especially on efficient Layer 2 networks.
Greater transparency: Transactions are recorded immutably on-chain, allowing for real-time tracking and automated reconciliation.
More importantly, it enables businesses to bypass congested correspondent banking networks, which still underpin most traditional international payments. According to the BIS , nearly 40% of cross-border transactions rely on just a handful of major correspondent banks, creating concentration risk and liquidity bottlenecks, especially in emerging markets. In contrast, blockchain-based rails use decentralised infrastructure that routes payments through faster, borderless channels.
However, the fiat off-ramp still depends on access to local currency. That's where Bitpace plays a key role: we partner with licensed financial entities and local payout nodes to ensure liquidity is available, where it's needed for clients. This decentralised but regulated approach shifts the burden away from slow, centralised institutions and toward programmatic, API-driven liquidity networks optimised for scale, speed, and compliance.
The stablecoin sandwich is especially powerful in regions where traditional banking infrastructure is patchy, restricted, or expensive. In Sub-Saharan Africa, for instance, the average cost of sending $200 is 8.5% . Stablecoin pathways offer a modern workaround, enabling access to liquidity without the inefficiencies of legacy financial networks. How it works: The technical filler
The stablecoin sandwich is built on three core steps: on-ramp, transfer, and off-ramp. Each step is designed to reduce cost, increase speed, and maximise transparency. Here's how the process works in practice: Fiat on-ramp: The sender begins by converting their local fiat currency (e.g., GBP) into a stablecoin (e.g., USDC) using a trusted payment service provider (PSP), crypto exchange, or an integrated payment gateway such as Bitpace.
Blockchain transfer: Once the stablecoin is issued, it is transferred via a blockchain network. The choice of network, Layer 1 or Layer 2, depends on speed, cost, and regional infrastructure. Each has trade-offs in terms of latency and transaction fees. For example, the Ethereum network can be used for high security and liquidity.
Fiat off-ramp: Once the stablecoin arrives, it is converted into the recipient's local currency (e.g., INR) through a licensed partner or PSP connected to local banking rails. Bitpace coordinates this process end-to-end through a network of verified payout nodes in key markets.
Because stablecoins are largely 1:1 backed when issued by regulated entities and held in transparent reserves, and are not subject to the volatility of other crypto assets. They serve as a safe, fast medium of value transfer, especially for B2B use cases.
In B2B use cases, such as payroll, treasury transfers, supplier payments, and digital export settlements, this balance of speed, stability, and programmability makes stablecoins a compelling instrument for moving value at a global scale. Crypto sandwich use cases
Many suppliers in Africa, Asia, and LATAM face delays in receiving payments through traditional banks, often waiting 3 days or more for funds to be settled, which are further diminished by FX spread losses. A stablecoin sandwich enables same-day delivery of funds with better FX rates, improved visibility, and full auditability.
Example: A UK-based e-commerce firm pays a textile manufacturer in the UAE. GBP is converted to USDC, sent via the Solana network, and instantly settled in AED through a local partner.
Remote talent marketplaces struggle with payout delays and high intermediary fees. With the stablecoin sandwich model, talent in over 100 countries can receive funds in minutes, in their preferred local currency or even as stablecoins.
Example: A London-based design agency pays contractors in the UAE. Payments are routed through Bitpace, converting GBP to USDC, sent over the Ethereum network, and withdrawn in AED.
Stablecoins offer programmable liquidity. Businesses can hold them during global settlement cycles to manage timing mismatches and use Bitpace to hedge or convert when rates are most favourable.
Example: A UK-based SaaS firm with clients in the UAE receives revenue in AED. They convert to USDC to hold until rates are favourable, then settle GBP expenses in the UK, all without touching legacy FX platforms.
Exporters of digital goods (think SaaS, gaming, digital art) often don't need the friction of banking systems. A stablecoin sandwich allows these businesses to sell to global buyers and receive clean, fast payments they can either hold or cash out.
Example: An indie game studio in England receives royalties from the UAE. Bitpace enables them to accept AED via USDC rails, convert to GBP, and settle in their UK business account. Why the sandwich works
The stablecoin sandwich is not just a workaround, it's an upgrade. It removes the weakest parts of traditional cross-border payments (slow banks, expensive FX, opaque routing) and replaces them with the strengths of crypto (speed, transparency, and programmability). At Bitpace, we've seen this model deliver real-world efficiency gains for our clients, without the regulatory or volatility concerns often associated with crypto.
Under frameworks like the EU's MiCA regulation, UK's FCA DP23/4, or Brazil's PL 4401/2021 and CVM/BCB division of roles, stablecoins will be issued by regulated e-money institutions, backed by 1:1 fiat reserves, and subject to rigorous audit requirements. This clarity is already attracting institutional players who want the benefits of crypto rails, without the volatility of speculative assets. As the market matures and stablecoin regulation (like MiCA) brings further clarity, I believe this sandwich will become the default meal for modern global payments.
Final thoughts
With global B2B payment volumes expected to surpass $150 trillion by 2025 , the pressure is on to modernise infrastructure. The stablecoin sandwich offers a path forward: one that combines the trust of fiat, the efficiency of crypto, and the compliance of licensed platforms like Bitpace.
Let's make moving money as simple and fast as sending an email (or making a sandwich). We're building the rails for compliant, real-time global value transfer. If you're a business, PSP, or financial institution looking to stay ahead of the curve, join us.