What is OTC trading?

Over-the-Counter (OTC) Trading, often simply referred to as OTC, is a method of trading that takes place directly between two parties without the need for a centralized exchange or intermediary. In the context of cryptocurrencies, this often means large-volume trades between institutional investors, high-net-worth individuals, and cryptocurrency businesses.

History of OTC Trading: OTC trading has been around long before cryptocurrencies. Stocks, commodities, and even currencies have been traded OTC for decades, often due to the fact that certain securities were not listed on formal exchanges.

Key Features of OTC Trading:

1. Direct Trades: Parties directly negotiate and finalize terms.
2. Privacy: OTC trades are often more private than exchange trades, which can be appealing to parties who want to keep their trade volumes and strategies confidential.
3. Customization: OTC trades can be tailored to fit specific needs, including the structure of the trade and the timing of its execution.