What is the process of OTC trading in the crypto market?

3 answers

• Kingsley YeboahDec 25, 2020 · 5 years ago
  OTC trading in the crypto market refers to the process of buying and selling cryptocurrencies directly between two parties, without the involvement of a traditional exchange. It typically involves large trades and offers more privacy and flexibility compared to trading on an exchange. To initiate an OTC trade, the buyer and seller negotiate the terms, including the price, quantity, and settlement method. Once the terms are agreed upon, the trade is executed, and the cryptocurrencies are transferred directly between the parties. OTC trading desks or brokers often facilitate these trades, providing liquidity and ensuring a smooth transaction process. It's important to conduct thorough due diligence and verify the counterparty's credibility before engaging in OTC trading to mitigate risks.
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• sharp swordFeb 24, 2025 · 6 months ago
  The process of OTC trading in the crypto market starts with the buyer and seller finding each other either through personal connections, OTC trading desks, or online platforms. They negotiate the terms of the trade, such as the price, quantity, and settlement method. Once the terms are agreed upon, the buyer sends the agreed-upon amount of fiat currency or cryptocurrency to the seller. Upon receiving the payment, the seller transfers the agreed-upon amount of cryptocurrency to the buyer's wallet. OTC trading is popular among institutional investors and high-net-worth individuals who prefer larger trades and more personalized service. It offers advantages such as reduced slippage and the ability to execute trades at a negotiated price. However, OTC trading may involve higher risks due to the lack of regulatory oversight and the potential for fraudulent activities. It's crucial to choose reputable counterparties and exercise caution when engaging in OTC trades.
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• OllaFeb 20, 2023 · 3 years ago
  In the crypto market, OTC trading is a process where buyers and sellers trade cryptocurrencies directly without using a traditional exchange. It's a popular method for large trades and offers advantages such as increased privacy and reduced market impact. To engage in OTC trading, buyers and sellers can connect through OTC desks, brokers, or online platforms. They negotiate the terms of the trade, including the price, quantity, and settlement method. Once the terms are agreed upon, the trade is executed, and the cryptocurrencies are transferred directly between the parties. OTC trading can be beneficial for those who want to avoid the potential price fluctuations and slippage associated with trading on exchanges. However, it's important to conduct thorough research and due diligence to ensure the counterparty's credibility and minimize risks. OTC trading is not regulated in the same way as exchange trading, so it's crucial to choose trusted and reputable counterparties.
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