The difference between on-exchange trading and over-the-counter trading in currency circles
- WBOYOriginal
- 2024-07-17 15:46:55922browse
Cryptocurrency market trading is divided into on-exchange trading and over-the-counter trading. On-exchange transactions are conducted on centralized exchanges, where the exchange matches orders and provides liquidity, and transaction fees are low; OTC transactions are conducted on unregulated platforms or peer-to-peer, and both parties directly negotiate prices and terms, with transaction fees Higher, usually involving large sums of money.
The difference between on-exchange trading and over-the-counter trading in currency circles
In the cryptocurrency market, trading is mainly divided into two forms: on-exchange trading and over-the-counter trading.
Exchange Trading
- Trade on centralized cryptocurrency exchanges.
- Trades are matched by exchanges and provide liquidity.
- The transaction price is affected by market supply and demand.
- Provides an order book showing the bid and ask prices of buyers and sellers.
- Trading fees are usually lower than OTC trading.
Over-the-Counter (OTC)
- Trade on unregulated platforms or directly between buyers and sellers.
- The parties to the transaction directly negotiate the price and transaction terms.
- Transactions usually involve large amounts of money.
- Transaction fees are higher than on-exchange trading.
Key Differences
| Features | On-exchange trading | OTC trading |
|---|---|---|
| Trading venues | Centralized exchanges | No regulated platform or peer-to-peer |
| Liquidity | Provided by exchanges | Lower |
| Price discovery | Affected by market supply and demand | Negotiated by buyers and sellers |
| Order book | Order book provided | No order book |
| Trading fees | Usually lower | Higher |
| Regulated | Regulated | Unregulated |
| Trading size | Usually smaller | Usually larger |
| Trading method | Order matching | Negotiate directly |
The above is the detailed content of The difference between on-exchange trading and over-the-counter trading in currency circles. For more information, please follow other related articles on the PHP Chinese website!