// GLOSSARY -- PAYMENTS & FINTECH

What is Wire Transfer?

1 min read Updated

A wire transfer is a direct bank-to-bank electronic transfer of funds — the traditional method for large domestic and international payments, increasingly compared unfavorably to crypto's speed and cost.

WHY IT MATTERS

Wire transfers are the backbone of traditional large-value payments. Domestic wires (Fedwire in the US) settle same-day. International wires (SWIFT) take 1-5 business days and cost $15-50 per transfer plus intermediary bank fees.

Crypto's advantage: stablecoin transfers offer wire-like finality (irreversible settlement) at a fraction of the cost (cents vs dollars) and time (minutes vs days). This is driving institutional interest in blockchain-based settlement.

The comparison is particularly stark for cross-border transfers: SWIFT's correspondent banking model involves multiple intermediaries, each adding fees and delays. A stablecoin transfer is direct and final.

FREQUENTLY ASKED QUESTIONS

How much do wire transfers cost?
Domestic (US): $15-30 outgoing, often free incoming. International: $25-50 outgoing, $10-20 incoming, plus intermediary bank fees that can add $15-30 more.
How fast are wires vs crypto?
Domestic wire: same-day. International: 1-5 business days. Crypto (L2): seconds. Crypto (L1): minutes. The gap is most dramatic for international transfers.
Will crypto replace wires?
For cross-border transfers, increasingly yes. Stablecoin settlement is faster, cheaper, and more transparent. Regulatory and banking system integration is the remaining friction.

FURTHER READING

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