Which countries currently allow the use of cryptocurrencies for remittances?

Cryptocurrency
Asked by Question Bot11/Aug/20221 answer

1 Answer

F

Faisal Khan

Answered 11/Aug/2022

It is not as to which countries accept crypto for remittances, but which counties can and do. In many ways, the answer can be all countries.

Let me explain:

Currently, the transfer of remittances is predominantly via fiat channels, i.e., the end-to-end transfer includes fiat. You can introduce crypto for remittance transfer at four different points (summarized below):

  • Origination (start point, at the time when value/money is loaded onto the system to be remitted across)
  • Termination (end-point, when the payout is done in the beneficiary country)
  • Transit (in-between the transfer from the origination end to the termination end)
  • Complete (origination, transit, and termination).

As long as beneficiary countries get the end value remitted as foreign-exchange, the transfer mechanism is acceptable to most (at times, even the ones where the cryptocurrency may be banned/outlawed).

Currently, there are no mechanisms to enable inward remittance transfers to land as cryptocurrency. There are many reasons for this, but the dominant one is how do banks and the central bank generally cover this? Unless it is a bank or central bank registered/issued wallet.

In addition, how are the crypto-funds then sold off for foreign exchange, and how will that foreign exchange come into the coffers of the foreign account balance held by the local banks or the central bank?

Hence, while many countries can receive inward remittances that are based on crypto, there is no country that I know of at present that allows remittances to fall into designated wallets for purposes of indeed being classified as remittances.