There’s no doubt that cryptocurrency has taken over the investment world, and slowly but surely, it’s expanding its link and market. Most users are now searching for the safest trading options to take up and trade large amounts anonymously, known better as OTC brokers (Over The Counter).
OTC brokers offer excellent opportunities to traders worldwide. They provide an opportunity to quickly get counterpart traders as they do the nitty-gritty, get in touch with sellers and buyers, and negotiate on your behalf.
This post will take you through all you need to know about OTC trading and how you can securely purchase a considerable amount of Bitcoin. It also provides a list of the best OTC brokers in the business and the pros and cons of OTC trading. So without any further ado, let’s jump straight into it.
Best OTC Brokers in Crypto Markets
OTC has credible brokers who offer high-quality services by facilitating direct Bitcoin deals and other cryptocurrencies among users. These exchanges can sometimes be fiat to crypto (exchanging fiat currencies such as the US dollar or Euros for crypto coins such as Bitcoin). Sometimes, the exchanges can also be crypto to cryptos (exchanging between crypto coins such as Bitcoin and Ethereum).
So without further ado, let’s look at some of the top Bitcoin OTC brokers.
Kraken is one of the most popular and credible crypto exchanges globally. It was founded in 2011; its OTC system was set up in 2018. While providing unique services, Kraken also supports over 45 cryptocurrencies, including Ethereum, Bitcoin, and Monero. As a result, it has become one of the leading OTC desks specialising in buying and selling large amounts of Bitcoin.
Kraken plans to broaden its BTC OTC exchange services, and just recently, it also acquired Circle Trade and Bit Trade, which are both leading OTC brokers. Additionally, it also supports numerous fiat currencies such as the Canadian dollar, US dollar, Euro, British Pound, and Yen.
Kranken has personalised its services as it now offers one-on-one OTC assistance to its users around the globe, 24/7. Their OTC services are free, with a minimum trading amount of $100,000.
2. Binance OTC
Binance is one of the most used cryptocurrency exchanges across the world. Besides offering personalised services to its users, Binance also provides deep liquidity services, making them a leading OTC broker. Its deep liquidity is pegged on high-end institutions and high-net-worth users keen to trade ridiculous amounts of Bitcoin and other cryptocurrencies.
Similarly, the Binance desk directly complements the Bitcoin OTC and offers crypto-to-crypto trading options such as Litecoin and Ripple, thus providing an excellent opportunity for its users. Binance OTC currently supports over 75 different cryptocurrencies and tokens, making it stand out amongst competitors.
Binance OTC provides its users with a great opportunity by allowing them to trade as little as $10,000. This minimum trading amount has opened doors for not-so-well established traders to have the upper hand in wide-ranging Bitcoin trading. The best part is that Binance offers personalised customer support services, which can come in handy if you have issues with your trading account.
Coinbase is another great OTC broker located in San Francisco, where it was first set up in 2011, and now it’s one of the most renowned in the trading game. They recently launched Coinbase Prime, a subsidiary for the management of crypto assets of numerous corporate institutions. Coinbase offers high-end institutional trading activities such as margin finance, OTC block trading, execution algorithms, etc.
2020 was a remarkable year for them as MicroStrategy chose Coinbase Prime as its leading execution partner to buy $425 million worth of Bitcoin. And recently, the platform has synthesised its stand by assisting Tesla is purchasing $1.5 billion worth of Bitcoin.
Coinbase offers an outstanding Bitcoin OTC experience with a straightforward and intuitive trading process like no other. Additionally, Coinbase has a well-established and reliable team of institutional coverage professionals that offers premium personalised services. It offers a secure platform where you can trade effectively without any malicious threat.
Satstreet is a leading OTC broker based in Toronto, Canada. It offers premium services to its users across the world. Besides its remarkably high-security standards, Satstreet is also reputable for registering with The Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) as a money service business (MSB).
Since its establishment in 2020, Satstreet has already registered over $300 million in terms of money transactions. It has built a reputation for its ease of access and a top tier security system that cannot be easily breached. Their most significant users include Bitcoin miners, super-wealthy individuals and institutions.
Satstreet offers a minimum investment of $25,000. You can also invest millions of dollars. The company collaborates with leading cryptocurrency companies such as Coinbase. Satstreet prefers to be referred to as a private cryptocurrency company.
Bitfinex is a leading OTC company established in 2012, with its headquarters in Hong Kong. It is one of the few brokers that allow its users to trade Bitcoin and other cryptocurrencies privately. You can easily link up with other Bitfinex users and trade effectively as it has instant liquidity through its OTC desk.
In 2018, Bitfinex announced the launch of Ethfinex Trustless, a decentralised OTC platform for trading ERC-20 tokens. It only charges 0.02% per trade. However, Ethfinex is a peer-to-peer platform, so clients are required to search for buyers or seek help from third-party brokers.
6. Huobi OTC
Since its founding in 2013, Huobi OTC has gained global popularity, which has led it to establish new offices in the United States, Japan, and Hong Kong. Huobi allows its users—individuals and high-net-worth institutions—to trade digital assets securely.
It comes with an OTC desk where clients can exchange large amounts of cryptocurrencies such as Bitcoin, USDT and Ethereum. Huobi OTC is a highly regulated and secure trading platform. Hence, all clients have to pass through stringent KYC/AML procedures.
Interestingly, Huobi OTC charges no extra fees, an added advantage for its users. They provide personalised services via their OTC desk while featuring worldwide execution coverage, liquidity, and multi-asset support. However, their minimum trade size is a little on the high side compared to other OTC brokers we’ve discussed. You need a minimum of $100,000 to start trading.
Pros & Cons of Bitcoin OTC Brokers
It might seem weird that users or institutions might want to forgo using simple services like the regular Bitcoin exchanges and trade with the occasionally problematic and opaque OTC brokers. However, OTC brokers are a great opportunity with many advantages to be exploited.
Let’s look at some of the advantages and disadvantages of OTC brokers.
Advantages of Bitcoin OTC Trading
Generally, OTC trading platforms aim to facilitate a seamless trading of cryptocurrencies without disrupting the market. Sometimes it’s easy to sell or buy large amounts of Bitcoin OTC, but this can significantly decrease or increase its overall value, causing disequilibrium and financial losses. That’s why you need OTC brokers to help you reduce market reaction, attention, and losses.
Additionally, many people find OTC trading interesting as it doesn’t have too many restrictions compared to traditional Bitcoin exchanges. OTC is secure and liquid, which is an added advantage. Moreover, it can directly purchase Bitcoin and other cryptocurrencies using fiat currency.
Disadvantages of Bitcoin OTC Trading
Even though using OTC comes with many advantages, it also has some notable disadvantages. One of the disadvantages is that you can’t start trading as quickly as you want, especially when you intend to sell large amounts of Bitcoin. You may have to wait for an extended period before an interested user finds your offer.
Secondly, OTC has a limited number of trading coins, so you can only trade Bitcoin and a few other cryptocurrencies. On the other hand, you can effectively sell or buy numerous digital assets when you use traditional crypto exchanges, which is a huge advantage.
Another disadvantage is that OTC trading is not entirely transparent. You have little or no information about your trading counterparty trader. OTC exchanges are not as regulated as traditional exchanges, so there are no strict measures to protect users from risky transactions.
Trading through OTC brokers is a lifetime experience that should not be taken lightly as it involves a considerable sum of money. Do your due diligence by conducting intensive research on your preferred OTC broker. Once you know their policies, you can decide whether or not to invest with them.