A new report from the Bank for International Settlements (BIS) reveals that nearly $600 billion in cross-border crypto flows took place in just one quarter of 2024 - driven largely by speculative activity and increasingly tied to macroeconomic conditions.
The data underscores how deeply crypto markets are becoming entangled with global finance, challenging the perception of the sector as a financial outlier.
Released on May 8, the BIS study analyzed transactions involving the two largest cryptocurrencies - Bitcoin (BTC) and Ethereum (ETH) - along with the two most widely used U.S. dollar-pegged stablecoins, Tether (USDT) and USD Coin (USDC). It concluded that the vast majority of these cross-border transactions were speculative in nature, closely mirroring global risk sentiment and interest rate fluctuations.
However, the report also acknowledged growing transactional uses, especially in regions grappling with high inflation and costly remittance systems, where crypto is increasingly seen as a viable alternative to traditional financial rails.
Key Takeaways from the BIS Report:
- $600 billion in cross-border crypto transfers were recorded in Q2 2024.
- Speculation, not utility, drives most crypto flows, especially in BTC, ETH, and USDC.
- Funding conditions in traditional finance - such as interest rates - significantly impact crypto activity.
- Transactional demand remains strong in regions with fiat instability or high remittance fees.
- Stablecoins like USDT are surging in usage in countries like Russia and Turkey for cross-border payments.
- Global interconnectedness is growing, raising regulatory, monetary, and financial stability concerns.
Speculative Capital Flow as the Primary Driver
The BIS findings reiterate a consistent theme in institutional research: the bulk of crypto transactions - especially cross-border - are speculative. These include arbitrage strategies, leveraged trading, and portfolio rebalancing driven by price volatility rather than utility-based usage.
The report observed that crypto flows spiked in periods of low funding costs and abundant liquidity, especially when central banks adopted accommodative monetary policies. In contrast, when borrowing costs rose, risk appetite fell, and capital retreated from crypto markets - mirroring patterns seen in traditional equities and foreign exchange markets.
This “pro-cyclicality,” the report says, reflects how closely crypto has become linked with broader financial markets. “We observe that tighter global funding conditions, known to curtail risk-taking in traditional asset classes, are associated with reduced flows,” BIS analysts wrote, framing it as evidence of growing systemic interdependence.
Stablecoins: From Trading Tools to Cross-Border Rails
While speculation continues to dominate, the report notes that stablecoins are slowly shifting toward more functional uses. In regions with high inflation or restrictive capital controls, dollar-backed stablecoins are emerging as preferred tools for remittance and trade settlement.
USDT, in particular, has become a de facto medium of exchange in parts of Asia, Eastern Europe, and Latin America. The BIS data shows that Russia and Turkey accounted for over 12% of all cross-border USDT flows in Q2 2024. Both countries have experienced steep currency depreciation and tightening international banking access, making crypto-based alternatives increasingly attractive.
Similarly, Bitcoin’s use in low-value international transfers appears to be driven by users seeking to bypass high traditional remittance costs - often exceeding 6% - that impact migrant workers and families in developing nations. The BIS found that when remittance corridors became more expensive or politically restricted, crypto flows rose in parallel.
Global Distribution of Cross-Border Crypto Payments
The BIS study highlighted notable geographic concentration in crypto flows:
- The United States and United Kingdom together accounted for around 20% of BTC and USDC transfers.
- Ethereum flows were also heavily concentrated, with nearly 30% tied to US and UK-based activity.
- Tether (USDT) transfers were more regionally diverse, led by Russia, Turkey, Ukraine, and several Latin American nations.
This distribution highlights a dual dynamic: while developed economies drive speculative flows through trading and institutional engagement, developing and politically volatile regions leverage crypto for practical cross-border use.
Structural Shifts in Global Crypto Usage
The BIS report comes amid wider institutional acknowledgment that crypto is no longer an isolated ecosystem. In recent months, policymakers and financial institutions have increasingly recognized stablecoins and decentralized finance (DeFi) protocols as components of global liquidity markets.
This has fueled new research into crypto’s impact on capital controls, monetary policy transmission, and financial stability - especially as total crypto capitalization surpassed $3.5 trillion in early 2025.
At the same time, the stablecoin market - anchored by Tether ($145B) and Circle ($60B) - is evolving beyond crypto-native platforms. Private payment firms, fintech startups, and even some banks are beginning to experiment with stablecoin integration for merchant settlement, cross-border payroll, and B2B transfers.
This aligns with findings from Fireblocks, a digital asset infrastructure provider, which noted that stablecoin usage among payment firms had grown by over 30% quarter-over-quarter in early 2025. Payment-related transactions are now outpacing trading-related flows in certain regions, the firm reported.
Regulatory Pressures and Systemic Risk Concerns
For the BIS, which serves as a forum for the world’s central banks, these trends are not merely technical - they’re systemic. The growing alignment between crypto flows and traditional capital markets introduces new transmission channels for financial instability.
The report also warned that rising retail exposure to volatile crypto assets could deepen global wealth inequality and pose challenges to consumer protection. These concerns were echoed in a separate BIS warning last month, which stated that “capital concentration in crypto markets has reached a critical mass.”
The lack of transparency in stablecoin reserves, reliance on off-chain banking relationships, and the use of offshore jurisdictions were also flagged as persistent vulnerabilities. These risks are particularly acute when crypto is used as a substitute for fiat in dollar-scarce economies, as they can undermine national monetary sovereignty.
The Policy Debate: Crypto, CBDCs, or Both?
The findings intensify ongoing debates among regulators and central banks regarding how best to approach digital money. While some jurisdictions - like the European Union - are leaning toward public-sector solutions such as central bank digital currencies (CBDCs), others, like the U.S., are exploring how privately issued stablecoins can coexist within regulated financial frameworks.
Ronit Ghose, head of Citi’s Future of Finance group, recently suggested that “depending on the country, there may be a stablecoin option or a CBDC option.” This choice could reshape global money movement over the next decade, especially in how it interacts with banking rails, capital controls, and retail liquidity.
The BIS report, though focused on flows rather than policy recommendations, serves as a warning: wherever digital money originates, its global impact is growing - and it is no longer isolated from traditional economic forces.
Final thoughts
What began as a niche system for peer-to-peer transactions is now evolving into a multi-billion-dollar cross-border infrastructure - riddled with speculation, yet increasingly tied to real-world utility. The BIS report on $600 billion in quarterly crypto cross-border flows illustrates a structural shift: crypto is no longer operating in a vacuum.
This transformation presents both opportunities and risks. For users in high-inflation or remittance-dependent economies, crypto tools may offer cheaper and faster access to international money movement. But for global regulators and financial stability bodies, the growing interconnectedness between crypto markets and traditional finance introduces new fault lines that require careful monitoring.
With stablecoins acting as bridge assets and Bitcoin increasingly embedded in international settlement flows, crypto’s presence in global money systems is no longer a speculative footnote - it’s an active, and rising, financial vector.