Why do some investors prefer OTC trading over traditional exchanges for large cryptocurrency transactions?

3 answers

• Padmashan NadeeraAug 18, 2024 · a year ago
  There are several reasons why some investors prefer OTC trading for large cryptocurrency transactions. Firstly, OTC trading allows for greater privacy and confidentiality compared to traditional exchanges. This is particularly important for high net worth individuals and institutional investors who may not want their trading activities to be publicly visible. Additionally, OTC trading provides the opportunity for negotiated prices and customized terms, which can be beneficial for large transactions where price slippage and market impact need to be minimized. OTC trading also offers faster execution times and deeper liquidity, as trades are often facilitated by market makers who can provide access to a larger pool of buyers and sellers. Overall, OTC trading offers more flexibility and tailored solutions for investors with specific needs and preferences.
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• Mohd SubhanDec 18, 2022 · 3 years ago
  Well, some investors prefer OTC trading over traditional exchanges for large cryptocurrency transactions because it allows them to avoid the limitations and restrictions imposed by exchanges. Traditional exchanges often have strict trading limits, which can be a hindrance for investors looking to conduct large transactions. OTC trading, on the other hand, allows investors to negotiate directly with counterparties, enabling them to execute trades of any size. Additionally, OTC trading offers greater price flexibility as trades are not bound by the order book of an exchange. This means that investors can potentially get better prices for their trades. So, for those looking for more freedom and flexibility in their cryptocurrency transactions, OTC trading is a preferred choice.
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• Shalve yaoJan 21, 2025 · 6 months ago
  At BYDFi, we understand that some investors prefer OTC trading for large cryptocurrency transactions due to the advantages it offers. OTC trading allows for greater privacy and confidentiality, which can be appealing to investors who value discretion. It also provides the opportunity for customized terms and negotiated prices, ensuring that investors can achieve their desired outcomes. Additionally, OTC trading often offers faster execution times and deeper liquidity, making it a suitable option for large transactions. However, it's important to note that traditional exchanges also have their own benefits, such as transparency and access to a wider range of trading pairs. Ultimately, the choice between OTC trading and traditional exchanges depends on the specific needs and preferences of the investor.
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