What are the risks associated with OTC investments in cryptocurrencies?

3 answers

• Dec 17, 2021 · 3 years ago
  OTC investments in cryptocurrencies can be risky due to the lack of regulation and oversight. Unlike traditional exchanges, OTC trades are conducted directly between parties, which increases the potential for fraud and scams. Additionally, the lack of transparency in OTC markets makes it difficult to assess the true value of the assets being traded. Investors should carefully evaluate the counterparty risk and conduct thorough due diligence before engaging in OTC trading.
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• Dec 17, 2021 · 3 years ago
  Investing in cryptocurrencies through OTC channels carries certain risks that investors should be aware of. One of the main risks is the possibility of price manipulation. Since OTC trades are not conducted on public exchanges, it can be easier for large investors to manipulate prices and create artificial demand or supply. This can lead to significant price fluctuations and potential losses for smaller investors. It is important to carefully assess the credibility and reputation of the OTC platform or broker before making any investment decisions.
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• Dec 17, 2021 · 3 years ago
  At BYDFi, we understand the risks associated with OTC investments in cryptocurrencies. While OTC trading can offer certain advantages, such as increased privacy and flexibility, it is important to be aware of the potential risks involved. These risks include counterparty risk, lack of regulation, and price manipulation. Investors should always conduct thorough research, seek professional advice, and diversify their investments to mitigate these risks. Remember, investing in cryptocurrencies is inherently risky, and it is crucial to only invest what you can afford to lose.
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