Stablecoins Are Coming for Cross-Border Payments. Is Remitly a Winner or a Loser?

Stablecoins are cryptocurrencies that are mostly pegged to the U.S. dollar. They're becoming a popular way for people in countries with currency devaluation issues to preserve their savings without buying U.S. dollars, and for companies to settle cross-border transactions at faster, cheaper rates than conventional interbank transfers. Stablecoins can also be staked (locked up) on various exchanges to earn higher yields than those from traditional savings accounts.

In other words, top stablecoins like Tether (CRYPTO: USDT) and USD Coin (CRYPTO: USDC) could eventually represent an existential threat to banks and other fintech companies. One fintech company that could be hurt in that seismic shift is Remitly (NASDAQ: RELY), one of the fastest-growing independent remittance service providers in the United States.

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Why could stablecoins disrupt Remitly?

From 2021 to 2025, Remitly's year-end active customer base increased from 2.8 million to 9.3 million, its send volume jumped from $20.4 billion to $74.9 billion, and its annual revenue soared from $459 million to $1.64 billion. Its adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) also turned positive in 2023, and grew 34% to $135 million in 2024 and 29% to $272 million in 2025. It also turned profitable for the first time in 2025.

But over the past five years, Remitly's stock plunged more than 50%. After that pullback, its stock looks undervalued at less than nine times this year's adjusted EBITDA. Remitly's stock is cheap because investors are concerned that stablecoins could disrupt its core business model.

Remitly generates most of its revenue by buying currencies at cheaper "interbank" rates and selling them to its customers at higher prices. It also charges transaction fees. Its blended take rate (foreign exchange margin plus transaction fees) is usually more than 2% per transaction.

By comparison, stablecoin-driven cross-border transfers are instant and cost fractions of a cent. But for now, stablecoins don't have Remitly's "last mile" advantage through integrations with local payment apps, physical banks, and retail stores. So while stablecoins are much faster and cheaper for cross-border transfers, they're much harder to withdraw.

However, payment giants like Visa, Mastercard, and PayPal have been integrating more stablecoin payments into their ecosystems. Those popular consumer-facing platforms could provide stablecoins with the "last mile" boost to finally disrupt pricier cross-border remittance services like Remitly.

While Remitly is still a major winner in the cross-border payments market, it could lose momentum as stablecoins reshape the competitive landscape. It isn't doomed, but it needs to find fresh ways to keep up with those changes to command a higher valuation.

Leo Sun has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Mastercard, PayPal, and Visa. The Motley Fool recommends the following options: short June 2026 $50 calls on PayPal. The Motley Fool has a disclosure policy.