The internet has made information free and global. So why is money transfer still so difficult and expensive?

The early internet promised a future where anyone could publish, build, or trade without permission. Protocols like email and the World Wide Web were open and neutral, sparking a burst of creativity, innovation, and entrepreneurship. But it veered off track over time.

Today, the global financial system is like a patchwork of corporate networks: centralized, closed, and predatory. Behind every transaction lies a Rube Goldberg-like (PANews note: a deliberately over-engineered or overdone machine) intermediary structure, such as point-of-sale systems, payment processors, acquiring banks, issuing banks, local banks, correspondent banks, foreign exchange brokers, and credit card networks. Each institution takes a cut, adds delay, and imposes rules. These networks levy unnecessary taxes on commerce and stifle innovation. They turn what should be neutral channels into high-friction bottlenecks.

Stablecoins, which are cryptocurrencies pegged to stable assets like the US dollar, offer a way out—a reset—a way to bring the original vision of the internet to money.

The Disruptive Opportunity of Stablecoins

The current payment system was not built for the internet—it was built for a world filled with fee-charging intermediaries (who once played a role in managing local cooperation, fraud prevention, and operations). Even today, the fees for international remittances can be as high as 10% (in September 2024, the average fee for a $200 remittance was 6.62%). These are not just frictions—they are effectively regressive taxes (PANews note: a tax that takes a larger percentage of income from low-income groups than from high-income groups) on some of the world's poorest workers. The inherited system is slow, opaque, and exclusive, leaving billions underserved or completely excluded from the global financial system.

For many businesses, traditional payment methods are extremely inefficient. Stablecoins can significantly improve this situation. B2B payments from Mexico to Vietnam typically take 3 to 7 days to clear, with costs ranging from $14 to $150 per $1,000 transaction, and up to five intermediaries taking a cut along the way. Stablecoins can bypass traditional systems like the international SWIFT network and the associated clearing and settlement processes, making such transactions almost free and instant.

This is not just theoretical—it is already happening. Currently, companies like SpaceX are using stablecoins to manage their corporate funds (including repatriating funds from countries with high local currency volatility, such as Argentina and Nigeria). Companies like ScaleAI are using stablecoins to pay global employees faster and cheaper. Meanwhile, in the B2C (business-to-consumer) space, Stripe is the first major provider to widely offer cryptocurrency payments, charging a 1.5% fee, which is half of traditional payment methods. This can significantly increase the profit margins of some businesses: as a16z partner Sam Broner pointed out, for businesses with very low profit margins, such as grocery stores, a 1.5% increase in profit margin could potentially double net income. (And in the competitive, blockchain-based market, transaction fees are expected to drop even lower).

Unlike the old financial system that developed in "silos," stablecoins are global by default. They run on blockchains: anyone can build open, programmable networks. Instead of negotiating with dozens of cross-border banks, you just plug into the network. People have already realized these advantages. In 2024, stablecoin transaction volumes reached $15.6 trillion, comparable to Visa's transaction volume. Although this figure mainly represents the flow of funds (rather than retail payments), its scale still indicates that we are on the brink of a financial infrastructure transformation that does not rely on the patchwork of 20th-century systems.

Instead, it is possible to build something entirely new—something truly native to the internet—or what Stripe calls the "superconductor of financial services," where what is achieved is not lossless energy transfer but lossless value transfer.

The "WhatsApp" Moment for Currency

Stablecoins offer us the first real chance to make currency open, instant, and borderless, just as email revolutionized communication.

Recall the evolution of text messaging. Before apps like WhatsApp, sending a cross-border text message meant paying 30 cents per message. And if the text message actually arrived, that was considered lucky. Then, internet-native communication apps emerged: instant, global, and free. Today's payment methods are like messaging in 2008: divided by borders, weighed down by intermediaries, and controlled by "gatekeepers."

Stablecoins offer a completely new alternative. Instead of cobbling together clunky, expensive, and outdated systems, stablecoins flow seamlessly on the global blockchain. These systems are programmable, composable, and designed for cross-border scalability. Stablecoins have already significantly reduced remittance costs: sending $200 from the US to Colombia costs $12.13 using traditional methods; with stablecoins, the fee is only $0.01. (The fee for exchanging stablecoins into local currency ranges from 0-5%, and prices are continuing to drop due to increased competition).

Just as WhatsApp disrupted expensive international calls, blockchain payments and stablecoins are changing global remittances.

Regulation: From Bottleneck to Breakthrough

It is easy to view regulation as a barrier, but wise legislation is the key to solving the problem.

Establishing clear rules for stablecoins and the crypto market may ultimately allow these technologies to move out of the sandbox and towards broader adoption. For years, DeFi has been trapped in a closed, circular, "coin-to-coin" economy. Not because these tools are useless, but because regulators have made it difficult for them to integrate into the traditional financial system.

This is changing. Policymakers are actively crafting rules to recognize and regulate stablecoins to maintain US competitiveness, protect consumer rights, and promote innovation. Well-thought-out regulations—such as a framework that distinguishes between network tokens and security tokens—can guard against bad actors while providing clear guidance for compliant players. In fact, an upcoming bill that clarifies regulatory rules may pave the way for broader adoption and integration into the global financial system.

Building Public Goods That Benefit Everyone

Traditional finance is built on private, closed networks. But the internet has shown the power of open protocols (such as TCP/IP and email) to drive global collaboration and innovation.

Blockchain is the native financial layer of the internet. They combine the composability of public protocols with the economic strength of private companies. They offer credible neutrality, auditability, and programmability. Adding stablecoins on top of them creates something we have never truly had before: an open monetary infrastructure.

You can think of it like a public highway system. Private companies can still build vehicles, run businesses, and create roadside attractions. But the roads themselves are neutral and open to all.

The role of blockchain networks and stablecoins goes far beyond reducing fees. They are giving birth to a new category of software:

• Programmatic Payments Between Machines: AI-driven markets automatically match deals for computing resources and other services.

• Micro-payments for Media, Music, and AI Contributions: Just set some simple budget rules and let "smart" wallets make the payments.

• Transparent Payments with Full Audit Trails: Use these systems to track government spending.

• Global Trade Without Cumbersome Intermediaries: Instantly settle international transactions at an extremely low cost—it is already happening.

The era of blockchain networks and stablecoins has arrived: technology, market demand, and political will are converging to make these applications a reality. A stablecoin bill may pass this year, and regulators are weighing frameworks that match risks with proper regulation. Just as early internet startups thrived after it was clear they would not be shut down by telecom companies or copyright lawyers, crypto is ready to bridge the gap from financial experiment to critical infrastructure, and stablecoins will lead the way.

There is no need to patch the old system; we can build a better one from scratch.

The internet has made information free and global. So why is money transfer still so difficult and expensive?

The early internet promised a future where anyone could publish, build, or trade without permission. Protocols like email and the World Wide Web were open and neutral, sparking a burst of creativity, innovation, and entrepreneurship. But it veered off track over time.

Today, the global financial system is like a patchwork of corporate networks: centralized, closed, and predatory. Behind every transaction lies a Rube Goldberg-like (PANews note: a deliberately over-engineered or overdone machine) intermediary structure, such as point-of-sale systems, payment processors, acquiring banks, issuing banks, local banks, correspondent banks, foreign exchange brokers, and credit card networks. Each institution takes a cut, adds delay, and imposes rules. These networks levy unnecessary taxes on commerce and stifle innovation. They turn what should be neutral channels into high-friction bottlenecks.

Stablecoins, which are cryptocurrencies pegged to stable assets like the US dollar, offer a way out—a reset—a way to bring the original vision of the internet to money.

The Disruptive Opportunity of Stablecoins

The current payment system was not built for the internet—it was built for a world filled with fee-charging intermediaries (who once played a role in managing local cooperation, fraud prevention, and operations). Even today, the fees for international remittances can be as high as 10% (in September 2024, the average fee for a $200 remittance was 6.62%). These are not just frictions—they are effectively regressive taxes (PANews note: a tax that takes a larger percentage of income from low-income groups than from high-income groups) on some of the world's poorest workers. The inherited system is slow, opaque, and exclusive, leaving billions underserved or completely excluded from the global financial system.

For many businesses, traditional payment methods are extremely inefficient. Stablecoins can significantly improve this situation. B2B payments from Mexico to Vietnam typically take 3 to 7 days to clear, with costs ranging from $14 to $150 per $1,000 transaction, and up to five intermediaries taking a cut along the way. Stablecoins can bypass traditional systems like the international SWIFT network and the associated clearing and settlement processes, making such transactions almost free and instant.

This is not just theoretical—it is already happening. Currently, companies like SpaceX are using stablecoins to manage their corporate funds (including repatriating funds from countries with high local currency volatility, such as Argentina and Nigeria). Companies like ScaleAI are using stablecoins to pay global employees faster and cheaper. Meanwhile, in the B2C (business-to-consumer) space, Stripe is the first major provider to widely offer cryptocurrency payments, charging a 1.5% fee, which is half of traditional payment methods. This can significantly increase the profit margins of some businesses: as a16z partner Sam Broner pointed out, for businesses with very low profit margins, such as grocery stores, a 1.5% increase in profit margin could potentially double net income. (And in the competitive, blockchain-based market, transaction fees are expected to drop even lower).

Unlike the old financial system that developed in "silos," stablecoins are global by default. They run on blockchains: anyone can build open, programmable networks. Instead of negotiating with dozens of cross-border banks, you just plug into the network. People have already realized these advantages. In 2024, stablecoin transaction volumes reached $15.6 trillion, comparable to Visa's transaction volume. Although this figure mainly represents the flow of funds (rather than retail payments), its scale still indicates that we are on the brink of a financial infrastructure transformation that does not rely on the patchwork of 20th-century systems.

Instead, it is possible to build something entirely new—something truly native to the internet—or what Stripe calls the "superconductor of financial services," where what is achieved is not lossless energy transfer but lossless value transfer.

The "WhatsApp" Moment for Currency

Stablecoins offer us the first real chance to make currency open, instant, and borderless, just as email revolutionized communication.

Recall the evolution of text messaging. Before apps like WhatsApp, sending a cross-border text message meant paying 30 cents per message. And if the text message actually arrived, that was considered lucky. Then, internet-native communication apps emerged: instant, global, and free. Today's payment methods are like messaging in 2008: divided by borders, weighed down by intermediaries, and controlled by "gatekeepers."

Stablecoins offer a completely new alternative. Instead of cobbling together clunky, expensive, and outdated systems, stablecoins flow seamlessly on the global blockchain. These systems are programmable, composable, and designed for cross-border scalability. Stablecoins have already significantly reduced remittance costs: sending $200 from the US to Colombia costs $12.13 using traditional methods; with stablecoins, the fee is only $0.01. (The fee for exchanging stablecoins into local currency ranges from 0-5%, and prices are continuing to drop due to increased competition).

Just as WhatsApp disrupted expensive international calls, blockchain payments and stablecoins are changing global remittances.

Regulation: From Bottleneck to Breakthrough

It is easy to view regulation as a barrier, but wise legislation is the key to solving the problem.

Establishing clear rules for stablecoins and the crypto market may ultimately allow these technologies to move out of the sandbox and towards broader adoption. For years, DeFi has been trapped in a closed, circular, "coin-to-coin" economy. Not because these tools are useless, but because regulators have made it difficult for them to integrate into the traditional financial system.

This is changing. Policymakers are actively crafting rules to recognize and regulate stablecoins to maintain US competitiveness, protect consumer rights, and promote innovation. Well-thought-out regulations—such as a framework that distinguishes between network tokens and security tokens—can guard against bad actors while providing clear guidance for compliant players. In fact, an upcoming bill that clarifies regulatory rules may pave the way for broader adoption and integration into the global financial system.

Building Public Goods That Benefit Everyone

Traditional finance is built on private, closed networks. But the internet has shown the power of open protocols (such as TCP/IP and email) to drive global collaboration and innovation.

Blockchain is the native financial layer of the internet. They combine the composability of public protocols with the economic strength of private companies. They offer credible neutrality, auditability, and programmability. Adding stablecoins on top of them creates something we have never truly had before: an open monetary infrastructure.

You can think of it like a public highway system. Private companies can still build vehicles, run businesses, and create roadside attractions. But the roads themselves are neutral and open to all.

The role of blockchain networks and stablecoins goes far beyond reducing fees. They are giving birth to a new category of software:

• Programmatic Payments Between Machines: AI-driven markets automatically match deals for computing resources and other services.

• Micro-payments for Media, Music, and AI Contributions: Just set some simple budget rules and let "smart" wallets make the payments.

• Transparent Payments with Full Audit Trails: Use these systems to track government spending.

• Global Trade Without Cumbersome Intermediaries: Instantly settle international transactions at an extremely low cost—it is already happening.

The era of blockchain networks and stablecoins has arrived: technology, market demand, and political will are converging to make these applications a reality. A stablecoin bill may pass this year, and regulators are weighing frameworks that match risks with proper regulation. Just as early internet startups thrived after it was clear they would not be shut down by telecom companies or copyright lawyers, crypto is ready to bridge the gap from financial experiment to critical infrastructure, and stablecoins will lead the way.

There is no need to patch the old system; we can build a better one from scratch.