What is OTC Trading?
OTC trading refers to the trading of "over-the-counter" transactions and is therefore also known as over-the-counter trading. Here, a transaction is transacted directly between two market participants without an exchange being involved as an intermediary.
Instead of regular trading on a stock exchange, the OTC transactions do not take place via a central location, but rather are carried out via a network of individual traders, which ultimately brings both sides together. However, the parties involved do not necessarily have to come into direct contact, often the respective OTC business is done on behalf of brokers.
The so-called "OTC desks" are trading platforms that serve as contact points for corresponding transactions. Mostly cryptocurrencies are offered here, which for various reasons should not be traded on the regular exchanges. This is the case, for example, if the coin origin cannot be fully verified, since the providers from the early days of the Bitcoin movement no longer exist. Or simply for the simple reason that due to the low liquidity of the crypto markets, the price on the exchanges should not be moved.
Although this form of trading carries certain risks, such as counterparty risk, it also offers opportunities and freedom that are not available in the tight corset of regulated exchanges. Accordingly, OTC trading is becoming increasingly popular, whether with investors, traders or companies.
In the crypto industry, OTC desks are increasingly becoming an alternative, especially for investors who want to buy or sell large amounts of coins, such as miners or large investors or early adopters. At the same time, there are now also many investors who want to trade cryptocurrencies directly without being dependent on a crypto exchange.
Over-the-counter businesses are booming with crypto investors as the form of trading in the industry has recently grown in popularity.
Some experts estimate that OTC trading now has even higher daily trading volumes than the crypto exchanges. For example, a recent study by Digital Assets Research showed that between April 2018, between $ 250 million and $ 30 billion in trades were made on the OTC markets, while the usual crypto exchanges only reached $ 15 billion came.
How do I trade OTC with CoinNexus?
Our personal and private OTC service for traders who want to make large transactions is exclusively in direct contact.
We buy and sell a variety of cryptocurrencies and digital assets for you. We also take on all contractual matters and identify the counterparties personally on your behalf.