Our analysis points to cryptoassets also being used as a transactional medium. This is most apparent for stablecoins and low-value BTC payments. Higher opportunity costs of fiat currency usage, such as high inflation, spur bilateral cross-border transactions in both unbacked cryptoassets and stablecoins. Likewise, greater economic activity within both sender and receiver countries is often linked to increased crypto flows in most cases. Moreover, high costs of remittance payments through traditional financial intermediaries are associated with significantly larger cross-border flows in stablecoins and low-value BTC payments from advanced economies to emerging market and developing markets.

Finally, on the efficacy of capital flow management measures (CFMs) governing crossborder transactions, our analysis suggests that CFMs targeting the reduction of outflows from the sender country and the limitation of inflows into the recipient country have little impact on crypto flows. Indeed, CFMs may even correlate with an increase in cross-border flows of some cryptoassets, hinting at circumvention.