Can the OTC Market Actually Have a Significant Impact on the Bitcoin Price?

The over-the-counter (OTC) market has long been considered to be bigger in size and volume than the crypto exchange market, having a bigger impact on the Bitcoin price.

Large institutional investors and high profile retail traders often rely on the OTC market for orders that typically exceed $1 million to ensure the market has enough liquidity to facilitate the settlement.

On major fiat-to-crypto exchanges like Coinbase, Skew, a cryptocurrency options market data provider, said that purchasing over $4 million in Bitcoin could cost an investor a 10 percent premium.

The inefficiency of placing large orders on cryptocurrency exchanges naturally lead investors into the OTC market, as large premiums result in substantially higher rates.


Share this: