Meet the newest addition to Bitcoin Depot, our OTC (over-the-counter) Trading Service. With our new services, the trades you need happen faster, easier and more efficiently. In the early days of Bitcoin trading, whales preferred to trade on exchanges vs OTC brokers because that’s where the liquidity and trust was. There were frequently one thousand BTC buy walls and sell walls that traders would watch for clues as to future market direction. OTC BITCOIN TRADING - BUY GOLD WITH BITCOIN OTC The OTC Desk also lets you buy gold with Bitcoin, Ethereum, Dash & more Our otc desk enables anyone to trade bitcoin & gold in larger amounts directly with us. If you are an investor wanting to buy gold OTC bitcoin trading, simply fill out the form below to get a quote.
Otc bitcoin tradingBitcoin Depot OTC Services Institutional Trading
The key advantage of trading with a Bitcoin broker is the elimination of any slippage. Bitcoin brokers charge a single fee for their service, but they eliminate excess fees charged by major exchanges when making significant digital asset investments. Doing so will improve the odds of finding the right buyer or seller for any type of trade. In order to trade via an OTC Broker, investors will have to prove their source of funds and net worth to the firm.
Therefore, brokers require clients to complete an identity verification process known as KYC Know Your Customer , which helps prevent identity theft, money laundering, and other types of fraud. OTC brokers are not for everyone. The average investor should find everything they need on popular exchanges like Binance or Coinbase, but for larger investors trading over-the-counter makes sense.
Below is a comprehensive list of pros and cons for those investors considering an OTC Bitcoin Broker. Best Bitcoin Brokers Bitcoin Market Journal has researched and analyzed the top bitcoin OTC brokers to help investors identify the firm that is right for them. Aside from its OTC brokerage services, the company also offers retail investor solutions through its Circle Invest business and a payments service through its Circle Pay business.
The exchange also offers OTC bitcoin trading service targeted at high net worth individuals and businesses that want to transact in a minimum of bitcoin. No crypto withdrawal fees. Genesis has been offering its bitcoin brokerage services since , which makes it one of the longest-standing OTC bitcoin brokers in the market. Due to its ownership by the DCG, it is also considered one of the most reputable.
The Chicago-based company provides two-way liquidity in bitcoin and other digital currencies for high net worth individuals and enterprises. Clients are able to take advantage of post-trade settlement, allowing them to initiate a trade without depositing any cash. Clients are able to trade gold for bitcoin as well, with a minimum trade size of one ounce. It conducted the first-ever block trade of Bakkt bitcoin futures contracts. XBTO is also involved in crypto mining, using renewable energy to power its operation.
Investors who want to reap the benefits of OTC bitcoin brokers should first check the balance in their bank accounts before picking up the phone. Brokers require a certain level of cash or volume to justify the investment. Single exchanges, no matter the size, lack the liquidity necessary to fill massive order blocks. Exchanges fulfill the needs of the typical investor in the vast majority of cases.
Answering one simple question will, in most cases, reveal whether or not an investor should pursue OTC Bitcoin Brokerage trades: Does your total purchase amount exceed the limits of traditional digital asset exchanges? If so, then you are better off trading with an OTC broker. Once the funds are on the exchange, she then executes the market orders corresponding to the trades she wants to do. The price may have moved significantly against her trade in the period between when she decided to trade and the moment she was actually able to click the button.
This uncertainty and time-delay is a user struggle and contrasts sharply with the user experience she would have become accustomed to in equities trading. Because a stock brokerage account exists in the traditional financial system of non-bearer assets, the user has never had to worry about loss of funds if she leaves them on the exchange. Furthermore, the channels to move fiat from her bank to her exchange are much faster and smoother, without any random delays due to compliance.
When an institutional OTC client decides to trade, she pings her OTC brokers and is shown a two-sided quote for the size that she wants to deal. Because she has signed legal agreements with her brokers and her brokers have vetted her and trust her to fulfill her financial obligations, there is virtually no latency between intention to deal and ability to deal.
She can ask her top three brokers for a quote in anywhere from 25 to 2, BTC and choose the best price. Once the price is agreed, she has a period of time to be able to send instructions to the necessary custodians to move her coins or to her bank to move her fiat. The funds may even come from several sources staggered through time. Of course, the OTC brokers need to dedicate some balance sheet to be able to quote on a post-trade settlement basis for her.
This capital needs to be sitting on call awaiting client demand. Nonetheless, they are compensated for this encumbrance via the optionality which they gain from sitting in the middle of this flow. For instance, they may decide to not actually hedge her trade in the real market. If the client wants to sell but one of the brokers is bullish himself, he may quote a better bid and then just warehouse the risk.
Even for a risk-averse broker, if the broker knows they have an opposite-way client looking to trade in a few minutes, they can refrain from paying exchange fees on hedging and wait for their flows to net off instead. In addition, OTC brokers can access both leveraged and non-leveraged sources of BTC liquidity, so depending on the market conditions, they are able to make significantly more than just the bid ask spread on any given transaction.
For instance, if perpetual swaps are cheap, then they can buy those instead of buying spot itself when hedging for a client. For the client, she of course benefits from this as well as the broker can quote tighter spreads versus if she had just deposited onto a single exchange. Moreover, the broker likely qualifies for a much better commission tier than she herself does.
If she only trades once a month, she would certainly receive a much better all-in price from an OTC broker than from a spot exchange.
There were frequently one thousand BTC buy walls and sell walls that traders would watch for clues as to future market direction. Meanwhile, there were few OTC brokers reputable and professional enough to handle an eclectic mix of clients. With the presence of vast liquidity on derivatives exchanges such as Bitmex and Deribit as well as indications of interest in the OTC market, these whales would be doing themselves a huge disservice by signalling their interest on a single venue while being unable to access the liquidity on others.
They risk not only failing to lock in their desired price but also leaking their intentions to the rest of the world. Indeed, exchanges requiring larger traders to fully fund their spot transactions will continue to shepherd volumes toward OTC brokers who give clients the flexibility they demand. It is thus no surprise that many exchanges have rushed to hedge their existing exchange-trading business lines by offering their own OTC services.
It will always be a lower-friction, higher throughput, more private, and more bespoke experience to deal bilaterally.