OTC Desk: what it is and how it works

Understanding OTC: beneficial for large-volume transactions in the crypto market.

What does OTC (over-the-counter) mean in the context of the crypto market? This term refers to transactions that occur directly between two parties outside of exchanges. OTC trading is particularly popular among traders handling large-value orders, as it offers distinct advantages.

Explore the meaning of OTC and why it’s a compelling option in this article.

What does OTC mean?

OTC stands for over-the-counter and refers to financial transactions conducted directly between parties, bypassing regulated or public markets. These operations take place privately between the buyer and the seller or through intermediaries like banks, dealers, or brokers.

The transaction terms—such as price, quantity, expiration date (if applicable), and other conditions—are negotiated directly. These negotiations can be done verbally, by phone, via email, or on a specialised platform.

Although OTC transactions occur outside regulated markets, they are still subject to prevailing financial regulations within the respective jurisdiction.

The advantages of OTC in the crypto market

In the crypto market, OTC trading has specific benefits, particularly regarding liquidity.

This service is often sought by institutional investors, high-volume traders, and individuals who wish to trade substantial amounts of cryptocurrency outside public exchanges. Typically, these transactions involve amounts exceeding €50,000.

Trading such large volumes on an exchange can lead to challenges for both the trader and the broader market participants.

Market volatility: The relatively lower crypto market liquidity than traditional financial instruments means that large trades can cause excessive price volatility. These temporary price spikes could lead to slippage for other traders or even trigger false trend signals (e.g., a bull trap).

Order fulfilment issues: Most exchanges lack sufficient liquidity to fulfil a large order at a single price point. To execute such an order, the exchange must aggregate smaller offers from the order book, often resulting in partial execution or rejection of the order if the volume is too large.

The Young Platform OTC desk

Young Platform’s OTC service caters to investors and businesses looking to buy or sell significant amounts of cryptocurrency.

Our clients’ needs extend beyond simple trading. Business accounts may aim to diversify corporate liquidity or to convert large crypto payments into euros, such as capital increases that require notarisation in fiat currency.

Key features of our OTC desk

• Access to over 70 trading pairs (crypto-fiat and crypto-crypto).
• Transactions start from €50,000, with no upper limit.
• One-on-one contact via phone.

How does an OTC transaction work?

• Contact the team via email.
• Receive instructions on accessing the desk.
• Get a quote: The OTC desk will provide a price and the estimated value you’ll receive. The offer is valid for one minute, during which you can accept or decline and await a new quote.
• Execute the order: Once you accept a price, the order is processed, and the corresponding amount is credited to your Young Platform account.

Additionally, you can request limited orders or support for transfers and related operations.

Contact us now to execute an OTC transaction at [email protected]. 

The information in this article is for information purposes only and does not constitute an incentive to invest.