Digital currency over-the-counter (OTC) is a private and flexible transaction method that is directly negotiated by buyers and sellers without the need for an exchange. Its characteristics: 1. Privacy: identity and transaction details are not disclosed; 2. Flexibility: transaction conditions can be customized; 3. Offline: transactions are conducted through chat tools. Its advantages: 1. Large transaction scale; 2. Flexible transaction prices; 3. High transaction efficiency. Its shortcomings: 1. Poor liquidity; 2. High transaction risk; 3. Imperfect supervision.
Digital Currency OTC (Over-the-Counter Trading)
What is Digital Currency OTC?
Over-the-counter (OTC) is a method of trading digital currencies that is usually conducted outside of an exchange and negotiated directly between buyers and sellers. Unlike trading on an exchange, OTC trading is not regulated by a central agency, making the trading process more flexible and private.
Features of OTC transactions:
- Privacy: OTC transactions are not supervised by a central agency, and the identities of buyers and sellers and transaction details are not Will be made public.
- Flexibility: OTC transactions can be customized according to the specific needs of buyers and sellers, including transaction price, transaction size and delivery method.
- Offline: OTC transactions are usually conducted through chat tools, phone calls or emails, without the need for online operations at the exchange.
Advantages of OTC trading:
- Large transaction size: OTC trading usually involves large transactions and is suitable for institutional investors or high net worth individuals.
- Flexible transaction price: Buyers and sellers can determine the transaction price through negotiation and are not affected by exchange price fluctuations.
- High trading efficiency: The OTC trading process is usually faster and more efficient than exchange trading, and there is no need to wait for orders to be matched.
Disadvantages of OTC trading:
- Poor liquidity: The OTC trading market has poor liquidity, and buyers and sellers may need Wait a while to find a suitable counterparty.
- Transaction risk: The privacy and offline nature of OTC transactions also bring transaction risks, such as fraud and fund security issues.
- Imperfect supervision: OTC transactions lack a unified supervision system, and buyers and sellers need to bear the transaction risks themselves.
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