What is Crypto OTC?

Crypto OTC is a trading tool that comes from traditional stock exchanges. OTC stands for Over-the-Counter. The term appeared at the end of the 19th century in connection with the practice of buying shares from bank counters or, in general, on the street near the stock exchange.

Why is it profitable to trade crypto on the OTC market instead of CEX?

The main problem with almost any cryptocurrency asset is that it has insufficient liquidity. Almost any large trade can greatly affect the rate. Consider a CEX example, i.e. Centralized crypto Exchange.

Why is it better to trade crypto on the OTC market instead of DEX?

The situation on the DEX, i.e. decentralized exchanges, is a little different from the previous one. To sell the entire volume, you need to use several DEX exchanges or aggregators.

Why is there a demand for the crypto OTC market?

For a long time in history of the world of crypto the OTC market has been only open to big players and whales. However a number of factors have influenced the recent surge in interest and wider adoption of OTC in the crypto industry.

How crypto OTC transactions are carried out

Most often, transactions follow three scenarios:

  1. You trust your assets to a trader who sells them through exchanges, depending on the volume.
  2. A crypto OTC desk (a company engaged in over-the-counter trading) takes the responsibility to sell a large volume of assets, names a price for it, and conducts a transaction from its balance.
  3. A large buyer and a seller meet on the same website with an intention to exchange an asset at a price above or below the market.

How to carry out transactions on a decentralized OTC platform

There are several advantages of dOTC:

  • Anonymity
  • Reliability
  • The ability to exchange any assets
  • The ability to trade one lot with many participantsl
  • Possibility to take part in PART deals.

What is the most profitable way to conduct OTC transactions?

There are several options for conducting a crypto OTC transaction:

  1. A large seller can entrust his assets to a trader who will sell them on several exchanges. Of course, this method has a big drawback — you need to completely trust the trader and the exchanges, in fact, giving them your assets.
  2. A large amount of crypto can be sold through the OTC desk. In this case, the service assumes all risks, conducting the entire transaction from its balance. But you won’t be able to sell online without a huge discount and high commission for this service.
  3. A large buyer and a seller meet on the Defi OTC platform with an intention to exchange an asset at a price above or below the market. This is a transaction with the lowest risk and acceptable discounts for the seller.

--

--

The first decentralized OTC desk. Make large crypto transactions while skipping order books and decentralized liquidity pools with smart contacts of Marsbase

Get the Medium app

A button that says 'Download on the App Store', and if clicked it will lead you to the iOS App store
A button that says 'Get it on, Google Play', and if clicked it will lead you to the Google Play store
MARSBASE OTC

The first decentralized OTC desk. Make large crypto transactions while skipping order books and decentralized liquidity pools with smart contacts of Marsbase