Crypto Speculation Drives $600B in Cross-Border Payments, Says BIS Report

$600 Billion in Cross-Border Crypto Payments Tracked in Q2 2024

A new report from the Bank for International Settlements (BIS) reveals that an estimated $600 billion in cross-border cryptocurrency payments were made during the second quarter of 2024, led by Bitcoin (BTC), Ether (ETH), and stablecoins USDt (USDT) and USDC. The findings suggest that while speculative investment remains the primary force behind these flows, real-world transactional use cases—such as remittances and inflation hedging—are also gaining momentum.

Published on May 8, the report analyzes crypto fund flows and usage patterns across various markets and identifies growing links between crypto markets and traditional financial conditions.

Cross-border crypto asset flows by quarter. Source: BIS

Speculation Still Dominates Crypto Cross-Border Activity

The BIS concludes that the majority of these cross-border payments are speculatively motivated, tightly connected to global macroeconomic factors—especially funding conditions in major markets. As global interest rates and liquidity shift, so too does crypto capital allocation.

“Our findings highlight speculative motives and global funding conditions as key drivers of native crypto asset flows,” the BIS stated.

The report points out that tighter financial conditions tend to dampen risk appetite, leading to reduced crypto flows, similar to trends in traditional financial markets. This behavior suggests that crypto assets are becoming more intertwined with mainstream finance, undermining their original perception as uncorrelated or independent instruments.

Stablecoins and Bitcoin Serve Real Transactional Use Cases

Despite the dominance of speculative activity, the BIS acknowledges a growing number of practical cross-border use cases, particularly involving stablecoins like USDT and USDC, and low-value Bitcoin transactions. These use cases are especially prominent in regions facing:

Global USDT flow map. Source: BIS

Currency instability

Expensive international transfer fees

The report cites that higher opportunity costs associated with fiat currency usage often drive demand for crypto alternatives in remittances and cross-border trade. Moreover, economic activity in both sending and receiving countries plays a significant role in influencing crypto transfer volume.

“Higher opportunity costs of fiat currency usage, such as high inflation, spur bilateral cross-border transactions in both unbacked cryptoassets and stablecoins,” the BIS noted.

This is particularly true in emerging markets, where access to stable, low-cost financial infrastructure is limited. The report links high remittance fees and inflation to the adoption of crypto-based money transfers—especially for workers sending money home from developed to developing countries.

Geographic Patterns in Crypto Payments

The report offers key regional insights into who is using crypto for cross-border payments:

The US and UK collectively account for 20% of BTC and USDC transfers, and nearly 30% of ETH cross-border flows.

Russia and Turkey contribute to over 12% of USDT cross-border usage, reflecting a preference for stablecoins amid economic instability.

These figures suggest that while the West leads speculative and investment-driven activity, emerging markets are increasingly leaning on crypto for real-world utility, particularly as monetary volatility persists.

BIS Warns of Financial Stability and Inequality Risks

The May 8 findings come on the heels of an earlier BIS warning from April, where the organization highlighted how growing investor participation and capital inflows into crypto and DeFi could pose threats to financial stability and global wealth inequality.

The latest report reinforces this concern, noting that crypto assets are no longer isolated from the traditional financial ecosystem. Instead, their behavior now mirrors that of mainstream speculative assets, making them vulnerable to global market shocks, regulatory shifts, and monetary policy changes.

Conclusion: Speculative Growth Meets Real-World Adoption

While speculative investment continues to dominate the crypto cross-border payment landscape, the BIS report shows a growing dual identity for cryptocurrencies: as both volatile financial instruments and practical transactional tools. In regions battling inflation and banking inefficiencies, stablecoins and Bitcoin are gaining traction as cost-effective, decentralized alternatives to traditional money transfer services.

Yet, with increased adoption comes increased systemic risk—raising important questions about how crypto should be integrated and regulated within the global financial system.