Coinbase customers are now able to send money to any person in the world with a Coinbase account using either Ripple (XRP) or Coinbase’s own stablecoin USDCoin (USDC) with no fee. Users can then convert the crypto into their local currency if they so choose. In the announcement, Coinbase described the service as “Fast,” Free,” and “Global,” avialable to users “in any supported country, including India, Mexico, and the Philippines.”
It seems Coinbase chose XRP and USDC for this feature — what you might call remittances — because both cryptoassets are designed for cross-border transmission. Although the service is free, Coinbase notes that there is a nominal on-chain network fee for sending outside of Coinbase, which is to be expected.
Per an infographic included in the announcement, a normal bank transfer can take one to two business days, whereas XRP (3-5 seconds on-chain) and USDC (12-17 seconds on-chain) are much, much faster — borderline instant. And while bank transfers are global in nature, so, for the most part, are XRP and USDC — each is supported in more than 100 countries.
Most importantly, there is usually an approximately $30 USD fee for sending money across borders when using a bank. For XRP and USDC, there is no fee when sending crypto to someone who also has a Coinbase account, and the fee is less than one penny when sending XRP off Coinbase, and a sub-one dollar fee when doing the same with USDC. Moreover, there is no limit at all on how much you can send via Coinbase, whereas limits almost always apply when using a bank.
With this move, Coinbase appears to be fulfilling one of the promises of crypto — allowing for greater financial freedom in the form of free cross-border payments and money transfers.