What are the advantages of trading cryptocurrencies OTC compared to regular exchanges?

3 answers

• Dec 16, 2021 · 3 years ago
  OTC trading offers several advantages over regular exchanges when it comes to cryptocurrencies. Firstly, OTC trading allows for larger transactions, as there are no order book limitations or liquidity constraints. This is especially beneficial for institutional investors or high-net-worth individuals who want to trade large volumes of cryptocurrencies without causing significant price fluctuations. Additionally, OTC trading provides privacy and anonymity, as trades are conducted directly between buyers and sellers, without the need for order matching. This can be appealing for individuals who value confidentiality and want to avoid the potential risks associated with public order books. Lastly, OTC trading often offers better pricing and tighter spreads compared to regular exchanges, as it involves direct negotiation between parties. This can result in more favorable prices and reduced trading costs for participants.
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• Dec 16, 2021 · 3 years ago
  When it comes to trading cryptocurrencies, OTC trading has its advantages over regular exchanges. One major benefit is the ability to access a wider range of cryptocurrencies that may not be available on traditional exchanges. OTC desks often have access to a larger pool of digital assets, including those with lower trading volumes or limited market availability. This allows traders to diversify their portfolios and explore new investment opportunities. Another advantage of OTC trading is the flexibility it offers in terms of settlement options. Unlike regular exchanges, which typically require immediate settlement, OTC desks allow for customized settlement terms, including deferred settlement or payment in different currencies. This can be particularly useful for international traders or those with specific liquidity needs. Overall, OTC trading provides greater flexibility, access to a broader range of cryptocurrencies, and customizable settlement options.
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• Dec 16, 2021 · 3 years ago
  From a third-party perspective, BYDFi believes that OTC trading offers unique advantages for trading cryptocurrencies compared to regular exchanges. One key advantage is the reduced impact on market prices. OTC trades are often conducted off-exchange, which means they do not affect the price of the cryptocurrency on regular exchanges. This can be beneficial for large traders who want to avoid slippage and minimize market impact. Additionally, OTC trading provides personalized service and support. Traders can work directly with OTC desks to negotiate prices, discuss trading strategies, and receive tailored assistance. This level of personalized service is often not available on regular exchanges, where traders rely on automated systems and limited customer support. Overall, OTC trading offers reduced market impact and personalized support, making it an attractive option for trading cryptocurrencies.
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