What is the difference between OTC trading and traditional exchange trading in the crypto industry?

3 answers

• maryam sarbizhanMay 13, 2023 · 2 years ago
  OTC trading, or over-the-counter trading, refers to the process of buying and selling cryptocurrencies directly between two parties without the involvement of a centralized exchange. This method of trading offers greater privacy and flexibility compared to traditional exchange trading. OTC trades are usually executed through brokers or dealers who match buyers and sellers. OTC trading is popular among institutional investors and high-net-worth individuals who trade large volumes of cryptocurrencies. It allows for customized transactions and can provide access to deeper liquidity pools. However, OTC trading may involve higher transaction fees and counterparty risks compared to trading on traditional exchanges.
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• chRiceJan 27, 2022 · 3 years ago
  In traditional exchange trading, cryptocurrencies are bought and sold on a centralized platform, such as Binance or Coinbase. These exchanges act as intermediaries, matching buy and sell orders from different traders. Traditional exchange trading offers greater transparency and price discovery compared to OTC trading. It provides access to a wide range of cryptocurrencies and trading pairs. Traditional exchanges also offer features like order books, market depth, and real-time price charts. However, trading on traditional exchanges may require users to go through a registration and verification process. It is also subject to market volatility and may have limited liquidity for certain cryptocurrencies or trading pairs.
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• Nithil NandakumarNov 22, 2021 · 4 years ago
  At BYDFi, we offer both OTC trading and traditional exchange trading options for our users. OTC trading allows users to trade large volumes of cryptocurrencies with competitive pricing and personalized service. Our OTC desk provides access to deep liquidity and ensures secure transactions. On the other hand, our traditional exchange platform offers a wide range of cryptocurrencies and trading pairs with real-time market data and advanced trading features. Users can choose the trading method that best suits their needs and preferences.
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