Why retail investors need the crypto OTC market
In this article:
OTC market is considered to be a place where only crypto whales meet to make transactions of millions of dollars.
This is partly true, more precisely, it was until recently. Now Marsbase unlocks large OTC trades for investors smaller budgets. All thanks to the new decentralized OTC platform Marsbase with the function of partial deals.
Who made the most money in 2017–2018?
OTC managers who helped people buy and sell crypto. Back them there was not enough liquidity in the markets of different regions, as well as knowledge about the industry in general.
OTC managers collected liquidity, let’s say bitcoins or ether, and sold it at a slightly higher price. At the same time they’d put their commission into the transaction. Of course, OTC managers carried a lot of risks as well. But now everything is different.
Marsbase gives a new meaning to the concept of an OTC broker, adding decentralization, security, anonymity, simplicity, speed and a lot of altcoins to it. What for?
Today, the situation in the DeFi segment is the same as with Bitcoin in 2017. There is little liquidity that is not enough even for trading medium cap altcoins and high commissions. Marsbase solves those issues. Here you can try yourself as an OTC manager and earn commission from decentralized OTC transactions, no matter how much money you have. The main thing is to actively share links to other people’s deals.
At Marsbase, we have developed a special way to share links to specific deals of any person and earn from it yourself.
What does it give and how will it work
- The ability to quickly transfer information (quick link) about a specific transaction to other users, including those who have not previously used the platform. These users immediately become your referrals.
- Each offer has its own unique URL. Your referral ID may be added to it. Each shared link is included in the active links in your referral program dashboard. All this is done in a couple of clicks.
What will an OTC manager earn?
Firstly, part of the commissions of the Marsbase platform, which are built in a very interesting way. Commissions on the OTC market are often rather high and depend on the size of the transaction, the capitalization of the asset being sold, and the amount of liquidity in the market. In our case, commissions are more flexible and much more profitable than on any OTC site in the world.
Secondly, the size (%) of income from deep links is cumulative and depends on the level of account reputation (the system will be introduced in the second quarter of 2022).
Here’s an example:
Let’s say Marsbase receives $800 from a particular OTC deal. If 50% of this transaction was closed using the deeplink of some OTC manager, and he, for example, has the 1 reputation level, then he — the manager will receive $20 only for sharing the link.
That is it, just posting that link in some niche crypto chatcan bring a lot of bidders while they will enjoy 5–10–15% discounts on your altcoins. Those bidders attracted by your link will automatically become your referrals.
Once again, watch the hands:
- You can earn from expenses, i.e. from the commissions of other users that you brought to the platform.
- For every link you share and a user who comes to Marsbase with your help, you will earn revenue as a share of that user’s spend. If a new user creates an offer or a bid, then even from level 1 you still get shares from Marsbase commissions.
- If your referrals who clicked on the link (it doesn’t matter if they bid on the total or not) also open their offer and pay fees, then this is a different kind of income — it depends on the status in the system. More on this in the coming article.
- All money is taken from fees only. Each referral can get you additional income depending on your reputation level.
One side note: Deeplinks are under development. It is likely that we’ll launch them in March.
This is all about the first way to make money on the Marsbase crypto dOTC platform.
Let’s take for example an ordinary user, the same bidder who went through someone’s deep link to make a part deal.
He has a small budget, let’s say $500. Every day he strives to make money on crypto, looking for opportunities, studying the SPOT market, DeFi, NFT, farming and futures. Our hero is subscribed to 10 TG channels, has already faced losses and was hatching drawdowns. All this requires patience. And then he found an interesting post in one of the channels. A deep link to OTC trade with 8% discount on altcoin. Something interesting, he thinks.
In addition to earning from referrals, Marsbase gives you the opportunity to engage in pure arbitrage. You can now buy assets at a discount price and sell he same amount elsewhere at a higher price.
OTC is about over-the-counter transactions. Prices here often differ from market prices in a more favorable direction. For example, if ETH costs $3100 on the exchange, then it can easily cost $2800 on the OTC. Our part deals are created just in order to collect this large volume in parts together with other users. For the offer maker, it doesn’t matter if 1 or 101 people will close his deal. The main thing for him is to do it quickly and with minimal loss — preferably less than the price impact or slippage.
Hence, a seller decides for himself what attractive discount or, on the contrary, higher price to set for an asset and for how long to sell it. This provides a great arbitrage opportunity for all those small bidders who will tear this offer apart into many pieces as if they were a whale.
There is a but…
Marsbase currently only operates on the Ethereum network. So far, the commissions of this network often exceed $100, so you will have to wait for Layer 2 or the launch of the Marsbase cross-chain if you have very small budgets. Other networks will be added soon, such as BSC, where the network fees are much lower and are a couple of bucks. Then with a budget of up to $1000 it will also be possible to participate in transactions. But if your capital allows you to make transactions in ETH, then you can continue reading further.
What to do at OTC with a budget of $1,000–$10,000
Naturally, you can be an OTC manager and also earn from transactions. But now we will still consider the OTC trading strategy.
With this budget, you can already find a good deal for yourself with a 10–15% discount and buy a part of the asset — this is possible thanks to PART deals on Marsbase.
To find a suitable offer, you need to go to the OTC Desk and select the conditions you are interested in in the filters. You can set a discount of 40% and see who sells what from alts with such a discount. Go to the deal window, evaluate the attractiveness of the offer and try to take the asset for an adequate amount, based on risk management. We have already described different strategies for finding offers and placing bids here and in the videos here. You can then sell the asset and earn from arbitrage. Carefully! the offer must be fractional (PART).
Let’s say the bid has been placed, the smart contract funds have been sent to you. You go to some DEX or СEX and sell a piece (lot) of the deal bought on Marsbase.
You earned $200-$300 difference on top of what you paid for commission. For starters, it’s pretty good. And there are still a lot of offers!
In the example with this capital, we do not consider the possibility of opening offers ourselves, since the capital for this transaction is too small. It is easier to go and sell tokens to the market or buy from the market, but without a discount or premium, and most likely with a loss on the price impact and slippage, which, of course, depends on liquidity.
What to do with a budget of $10,000–$50,000 or more
With such a budget, you will most likely buy and sell cryptocurrency yourself to reduce the price impact loss, that is, you become an offermaker. But, of course, no one forbids you to also act as a bidder.
The usual crypto OTC market will not allow you to make transactions for $10–20–30k: this is too little. There are many OTC brokers and services, but the entry threshold there is from $100k, and small transactions are not in demand there, that is, none of the managers will contact you much. It’s like going to the wholesale market and buying 1 kg of rice.
But on Mars, the rules are different. For many low-capped altcoins, especially those in DeFi traded predominantly on the DEX, even a $50k or $100k trade can lead to very high volatility and a significant loss in price impact (read about price impact here).
Lack of liquidity simply will not allow you to make a deal at a good price. In this case, the project can be very good.
When opening a trade for $50k, you can use both a fractional Part trade and the “Best Bid” mode. You can read an article about the difference between transaction modes here.
Let’s look at an example if you participated in some kind of sale, say, a month or 2 ago. You have been credited with tokens after unfreezing. The liquidity of this project is still low. Regardless of the X’s, if you want to sell a $50k vest into the liquidity pool, you’re likely to scare others, trigger a panic sale, lose yourself, and upset the community.
Plus, the part of your capital that remains in the freeze will also dry up. That is why it is better to simply open a trade for the entire volume of the desired sale on Marsbase and collect offers from the market. Be prepared to give up the price, because it will more than pay off in the absence of a price dump and losses when selling into the liquidity pool.
Of course, this does not mean that only early investors can afford good discounts.
Well, or if you still decide to be a bidder, and you have $ 10–15k for Mars — this is already a sufficient amount to divide into two or three parts and participate, for example, in several offers. When something interesting appears, you will already have the necessary amount prepared, and you will not miss interesting deals.
By the way, soon we will set up automatic notifications based on saved templates and filters.
And once again
Whale discounts on any tokens
At the moment, there are 2 types of OTC trading modes on Marsbase with a choice of 150 currency pairs (ERC-20). It is in the interests of users to set prices below those that can be found on the exchanges, so there will always be the right asset at an acceptable and favorable price.
Participation in large transactions with any amount
Marsbase has a Part offer mode that allows you to sell large volumes of medium or low liquid assets to a large number of people. These are fractional transactions that are closed in parts. Due to the large number of participants (bidders), both full and partial closure of such transactions is possible. Retail investors can participate in Part deals with any amount of money. That’s why Marsbase is suitable for crypto investors with any budget.
P2P transactions can be carried out on the OTC market. If earlier this was possible only with a limited list of currencies, then Marsbase is the only platform that allows you to trade any altcoin, even not from the list of top ones according to CMC. You no longer have to look for liquidity on a dozen exchanges. In addition, OTC transactions are conducted out of the market, so they do not affect the value of assets.
No slippage or price impact
If trading rare assets on regular exchanges leads to a sharp drop in the price of the token, then on Marsbase you can be sure that this will not happen. P2P transactions do not affect the market price, they are transactions that transfer money directly from one wallet to another. Another benefit of Marsbase is the absence of price slippage, which usually happens if you trade assets in market conditions with insufficient liquidity. On dOTC Marsbase, transaction prices are fixed, which means that there is simply no difference between the initial cost per token and the value at the time of execution. There is also no slippage.
We know how important reputation is in the OTC market, and therefore we will help our users to increase it. Marsbase will introduce reputation levels, a task center and many other social features that will allow you to get the best OTC conditions and prices, expand the circle of investors with whom you do business, find people with similar strategies and values. A collaboration between crypto whales and retail investors will become possible. Reputation can also be increased by owning our unique NFT items, which will open access to additional VIP services, exclusive deals and closed pools.
Marsbase will soon launch its native token, MBASE. The utility lies in the fact that the token will act as a fuel for OTC transactions and be used in all platform modules: from the Ambassador program and NFT upgrade to the reputation layer, dark pools, farming, deep links and OTC Army. It is also a governance token that gives voting rights to all Marsbase dOTC users.
All this gives retail investors the opportunity to participate in OTC transactions same as whales and enjoy all their preferences.
In addition, if you have ideas for the development of the project or additional features, you can always share them with us in the Vote section.
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