Sending money across borders still costs a global average of 6.36% and often takes days (World Bank, Q3 2025 (opens in a new tab)). A growing share of those payments now settles through what the industry calls a stablecoin sandwich: local currency converted into a stablecoin at one end, moved across borders on-chain in seconds, then converted into the destination currency at the other. This article explains the mechanism, why businesses are adopting it, and where the cost actually sits.

What the “stablecoin sandwich” means

The stablecoin sandwich is a three-step structure that replaces the correspondent banking chain for a cross-border payment. Fiat is converted into a stablecoin at the origin, the stablecoin moves on-chain to the destination, and it is converted back into fiat for payout.

The stablecoin is the filling. Local currency is the bread on each side. The sender and the recipient never touch the token directly. They send and receive their own currency. The stablecoin does the crossing.

The three legs

  1. On-ramp. Collect the payment in the origin currency and convert it into a stablecoin.
  2. Transfer. Move the stablecoin on-chain to the destination wallet. This settles in seconds, around the clock, with no correspondent banks in the path.
  3. Off-ramp. Convert the stablecoin into the destination currency and pay out to a local bank account.

To make that concrete, picture a 500,000 EUR supplier payment from a European importer to a manufacturer abroad. Through correspondent banking it might pass through two or three intermediary banks, arrive two to three days later, and land short by a foreign exchange margin the sender never sees itemised. Through the sandwich, the same 500,000 EUR converts to a regulated token, crosses in seconds, and converts to local currency on arrival, with the spread as the one visible cost.

Why businesses use it

A traditional cross-border payment is routed through a chain of intermediary banks, each holding accounts with the next (the nostro and vostro model). That network is thinning and slow. The number of active correspondent banking relationships fell by around 22% between 2011 and 2019 (BIS (opens in a new tab)), and wholesale payments through the banks that remain still typically take 48 hours or more to settle (FSB (opens in a new tab)). Every hop adds cost and opacity, and the sender rarely sees the full fee until the money lands short.

The sandwich collapses that middle into a single on-chain transfer. It is near-instant, runs 24/7, and produces a clear record of the movement.

~10 seconds On-chain settlement of the transfer leg The cross-border movement that takes correspondent banking days completes on-chain in seconds, at any hour.

Where the cost actually goes

Here is the part that matters commercially: the on-chain transfer is close to free. The cost of a stablecoin sandwich sits almost entirely in the two conversions at each end, in the foreign exchange spread between local currency and the stablecoin.

That has a direct consequence. The true cost of the payment is set by how many parties sit between fiat and the stablecoin, and who controls the conversion. Every additional intermediary in the on-ramp or off-ramp takes a margin. A sandwich with a separate on-ramp provider, a separate token issuer, and a separate off-ramp provider stacks three sets of economics on top of each other.

The regulated version: the filling matters

Not every stablecoin in the middle is the same instrument. If the token is issued by an unregulated party, the sandwich carries counterparty and compliance risk through its core, whatever the two fiat legs look like.

If the token is a MiCA-authorised electronic money token, the middle leg is a regulated instrument: fully backed, redeemable at par, and issued by a licensed institution. For a regulated business, that is the difference between an unregulated crypto transfer and regulated settlement.

There is a structural point here too. When a single regulated institution runs all three legs, the conversion happens once, under one licence, and the margin leakage between separate intermediaries disappears.

What this means for your business

If you move money across borders, two questions decide your cost and your risk. How many parties sit between your origin currency and the destination currency. And whether the asset in the middle is regulated.

Compress the intermediaries and use a regulated token, and cross-border settlement stops behaving like correspondent banking.

Stable Mint runs the full sandwich under a single EMI licence: EUR and USD fiat rails on each side, our own MiCA-authorised electronic money tokens (EURSM and USDSM) as the settlement asset in the middle, and on-chain transfer in seconds. If you are designing a cross-border flow and want to see where the cost and the risk actually sit, talk to our team.