RockItCoin provides over-the-counter Bitcoin trading services with features that are specialized for the crypto market. Jul 23, · Bitcoin Over The Counter (OTC) Over the counter, trading is also known as off-exchange trading. It is done directly between two parties and allows the buy and sell off large quantities of bitcoin and other cryptocurrencies. The main advantage of the OTC is that they handle large volumes of coins. Genesis has broken off from SecondMarket and has offered its version of Bitcoin Brokering since , and this makes it one of the longest-running Over The Counter trading platforms in the marketplace. Thanks, in large part to being owned by the DCG, it holds a strong reputation among the Bitcoin Brokers.
Bitcoin over the counter tradingOver the Counter Trading – How the Whales Trade
The alternative is to go to the over-the-counter market where apples are sold off-exchange. In the OTC market, you can have various apple sellers, but the difference is that these sellers are not all located in the same place. They can be located all over the city or across the country. They can sell pears, strawberry, cherry and a bunch of other fruits. The dealer may collapse the same way as Lehman Brothers did.
The uncertainty with the over-the-counter market leaves you exposed to a certain amount of risks that are eliminated if you go through an exchange. Due to the high volume purchases, the whales need an alternative way to buy Bitcoin, different than the standard method that requires a crypto exchange. Buying large amounts of bitcoins can disrupt the market price if the order is placed through an exchange.
The benefit of bitcoin over-the-counter trading is not just that it gets rid of this issue, but the whales can also hide their steps from the general public when going through the over-the-counter market.
The first step is to find a reliable OTC desk that can satisfy all your needs. Usually, the onboarding documentation requires providing various types of legal papers to prove your identity and the source of income. Once you successfully manage to go through the KYC process and your identity is verified you can directly communicate with the over-the-counter dealer.
Usually, you have the option to send your order either electronically via text message or through an electronic platform or via voice call. No matter what your preferred method of communication may be, there will always be a dealer at the other end ready to help you.
As an investor, you have the option to accept or reject the price offered. If the price is fair and you agree to move forward with the transaction, the order is then confirmed. The transaction is completed once you wire the money for your purchase, and once the dealer sends you the bitcoins to your personal wallet address.
You may also be interested in this Bitcoin Day Trading Strategy. OTC over-the-counter trading allows you to stay under the radar if you want trade bigger size. Alternatively, the over-the-counter market also can give you access to stocks that are not listed on the regular stock exchanges. There is a lot of flexibility that comes with OTC derivatives like having the option to choose what instrument, how much, for what price and under what conditions you would like to make your purchase.
Everything is based on mutual consent. You may also like this guide on penny stock trading. To learn more about trading and various trading strategies be sure to follow our blog! One of the ways that it ensures its ongoing profitability through charging its investors a flat fee of 0. ItBit is a highly internationally pronounced company, with customers based in over different countries, and operates as one of the very few bitcoin exchanges that have full-fledged regulation and licensing to do business within the state of New York.
Operating as one of the few digital asset exchanges that boast a full regulatory authorization from the state of New York, Genesis Global Trading offers investors a meticulous two-sided liquidity market for a wide range of digital currencies which are traded on a daily basis.
Initially, Genesis had been a part of the Trading Division for SecondMarket, which was a company originally owned by the venture capital company — Digital Currency Group.
Genesis has broken off from SecondMarket and has offered its version of Bitcoin Brokering since , and this makes it one of the longest-running Over The Counter trading platforms in the marketplace. Thanks, in large part to being owned by the DCG, it holds a strong reputation among the Bitcoin Brokers.
Along with its own brokering services, it allows its customer's preferable access to GreyScale Investment Trusts including Digital Asset Lending. While it was registered and incorporated back in , the Jump Trading platform was one of the newer entrants into the world of digital asset trading, especially Over The Counter trading.
What sets the platform apart is the fact that it has since developed and implemented a dashboard which offers customers, investors, and traders to interact in a more efficient way with the OTC desk of Jump Trading. Why is unique is because this is done through a far more secure means of connection, and removes any reliance upon a third party messaging service, providing far more confidentiality for traders. Along with operating as an Over the Counter digital exchange for investors and traders, Jump Trading also operates as an advisory body for other companies and investors.
Much like some of it's Over The Counter counterparts, it provides its investors with a system of two-way liquidity within Bitcoin as well as other highly traded digital assets through its marketplace, specifically targetting individual investors and enterprises which make up the high net-worth stratum.
It manages to obtain a good degree of profitability by charging its lower rate transaction fee on each trade successfully completed within the platform.
Cumberland Mining also provides an effective service as an advisory body too and was incorporated back in before moving into the world of cryptocurrencies in Officially incorporated back in , the San Francisco based digital asset exchange Kraken has gained a strong reputation amongst seasoned cryptocurrency investors of all scales over the past decade. In , the Kraken team officially announced its intention of launching an Over The Counter trading service in order to provide a more stringent service for a more professional clientele, allowing them to purchase a range of digital assets through a range of off-exchange transactions.
Along with its OTC and crypto exchange services, Kraken's OTC service includes a wide range of additional services for its customers, including meticulous market analysis, fully customized 1 to 1 service, complete asset support as well as a hour international coverage of crypto assets and investor services.
Octagon Strategy operates as an Over The Counter service broker and headed up by the former head of the department of Electronic Trading for the multinational financial institution — Morgan Stanley.
The aforementioned Wayne Trench has argued that Octagon has gained status as Asia's largest digital asset broker. Officially launched back in , the London based company BitStocks seeks to provide its consumer base of higher net worth investors, companies and individuals a great degree of liquidity within the Bitcoin market.
In contrast with other platforms in the OTC market, where BitStocks turns its profits is from the commission in the execution price of every transaction on the system, which makes it quite similar to Genesis Global Trading in the way it handles commissions. One of the other ways in which it is able to draw in a profit is through performance fees attached to any investments that appreciate over time.
Some of the dramatic shifts in the world of cryptocurrencies made a good number of crypto investors question just what kind of proportion of crypto is being traded on exchanges relative to Over The Counter. Since these fluctuations, Vinny Lingham, one of the more outspoken entrepreneurs in the crypto space has made his opinions clear about this ratio of OTC:Exchanges:.
When it comes to the major investors in the world of Bitcoin, I. One of the reasons for this is that despite its high desirability from its community, Bitcoin has a serious problem with liquidity, in that it lacks a fundamental level of it. Slippage occurs when a buyer places a large order on an exchange, which is then filled by multiple sell orders that can vary slightly in price.
The result is an increase in total fees paid and a variance in the price paid for the asset. Direct transactions via OTC markets ensure a singular transaction at an agreed-upon price between the two parties.
The first thing to know about bitcoin brokers is that they are not financial advisors. 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.