Using USDT for cross-border remittance leverages its 'stablecoin' characteristics (pegged to the US dollar, convenient blockchain transfers) for cross-border fund transfers. The core process must be completed through cryptocurrency exchanges or wallets. Below are the specific steps, advantages, and risk warnings:

I. Basic Principles

USDT (Tether) is issued on the blockchain and is pegged to the US dollar (1 USDT ≈ 1 dollar), allowing for fast transfers on global blockchain networks, bypassing the traditional bank cross-border settlement system. Essentially: Fiat Currency → USDT → Blockchain Transfer → USDT → Target Fiat Currency.

II. Operational Steps (taking person-to-person remittance as an example)

1. Purchase USDT (initiated by the remitter)

- Choose a compliant platform: Register and complete KYC certification (ID/passport required) on cryptocurrency exchanges (like Binance, Huobi, OKX) or wallets (like Trust Wallet, MetaMask).

- Recharge Fiat Currency: Recharge RMB (or other fiat currencies) to the platform through bank transfer, Alipay, credit card, etc.

- Purchase USDT: Buy USDT on the platform using the recharged fiat currency (be sure to select the blockchain network, such as ERC-20, TRC-20, Omni, etc.; different networks have different fees and arrival speeds, recommended low fees and fast speeds like TRC-20).

2. Transfer USDT (initiated by the remitter)

- Obtain the recipient's address: Have the recipient generate a USDT receiving address on their platform/wallet (must match the same blockchain network; if the other party uses TRC-20, you must also choose the TRC-20 network for transfer).

- Initiate Transfer: In the platform's 'Withdraw' or 'Transfer' function, enter the recipient's address, USDT amount, select the blockchain network, and confirm the fee (usually a few dollars, TRC-20 fees are the lowest, approximately 0.1 USDT).

- Waiting for arrival: Blockchain transfers do not require bank review, usually arrive within 5-30 minutes (depending on network congestion).

3. Convert to target fiat currency (initiated by the recipient)

- Recharge USDT to the platform: The recipient transfers USDT to an exchange that supports their local fiat currency (e.g., using Binance Europe in Europe, Coinbase in Southeast Asia).

- Sell USDT: Exchange USDT for local fiat currency (e.g., euros, US dollars, Thai baht, etc.) on the platform, and once the funds arrive, they can be withdrawn to a local bank account.

III. Key Considerations

1. Blockchain Network Selection

Network Advantages Disadvantages Applicable Scenarios

TRC-20: Extremely low fees (close to free), fast speed; based on Tron blockchain, some platforms do not support it; suitable for small, high-frequency transfers.

ERC-20: Strongest compatibility (most platforms support it); high fees ($1-5), slower speed; general scenarios

Omni: The earliest USDT network, highest fees, largely phased out, legacy scenarios

Recommendation: Prioritize TRC-20 (high cost-performance ratio), confirm both parties' platforms/wallets support this network.

2. Compliance and Regulatory Risks

- KYC requirements: Exchanges usually require real-name certification to avoid using non-compliant platforms (e.g., unlicensed exchanges) to prevent account freezing.

- Local Regulations: Some countries (e.g., China, India) restrict cryptocurrency to fiat currency exchanges, confirming whether the recipient's country allows legal USDT transactions.

- Anti-Money Laundering Review: Large transfers may trigger platform risk controls, requiring proof of source of funds (e.g., salary, trade contracts, etc.).

3. Exchange Rates and Fees

- Exchange Rate Difference: There may be a 0.1%-0.5% exchange rate difference when the platform buys/sells USDT (for example, 1 USDT actually exchanges for 0.995 USD).

- Total Costs: Fiat currency recharge (may incur fees) + Blockchain transfer fees + Fiat currency withdrawal fees, total cost approximately 1%-3% (lower than traditional bank wire transfer's 3%-5%).

4. Reserve Trust Issues

USDT relies on Tether's dollar reserves (theoretically 1:1), if a trust crisis occurs (e.g., insufficient reserves), it may lead to USDT decoupling (price below $1), requiring the selection of platforms with transparent reserves (e.g., Tether publishes audit reports regularly).

IV. Advantages vs Traditional Remittance

Comparison Item: USDT Cross-Border Remittance vs Traditional Bank Wire Transfers

Arrival Time: Minutes (after blockchain confirmation) 1-3 working days

Fees Low (approximately $1-5) High (wire transfer fees + intermediary bank fees)

Cross-Border Restrictions: None (only limited by platform and local regulations) Subject to foreign exchange controls (e.g., $50,000 annual limit for individuals in China)

Flexibility: 24/7 transfers available, supports any global address, subject to bank working days and limited by the SWIFT system

Risks: Platform Compliance, USDT Decoupling Risk; Strict Bank Review, Complicated Processes

V. Risk Warnings

1. Platform Risk: Choose leading exchanges (like Binance, Coinbase) to avoid using unregulated platforms, preventing scams or account freezes.

2. Private Key Security: If transferring via a wallet, be sure to back up the private key (once lost, assets cannot be recovered), and never disclose the address or mnemonic phrase to others.

3. Legal Risks: Confirm the regulatory stance on cryptocurrency for both the remitter's and recipient's countries (e.g., China prohibits virtual currencies as payment tools, only allowing personal investment).

4. Decoupling Risk: In extreme cases (e.g., Tether scandal), USDT may temporarily devalue (e.g., it once fell to $0.95 in 2022), so it is advisable to convert to fiat currency as soon as possible after the transfer.

VI. Summary

Using USDT for cross-border remittance is suitable for scenarios requiring fast, low-cost cross-border transfers and accepting cryptocurrency risks (e.g., international trade, studying abroad, cross-border e-commerce payments). The core operation is: choose a compliant platform → match the blockchain network → complete the conversion from fiat to stablecoin to fiat. Be sure to pay attention to regulatory compliance and platform security, and conduct small trials before proceeding with large transfers.