Advantages of OTC trading

OTC or Over-The-Counter trading means that buyers or sellers of a certain asset intend to trade in a peer-to-peer fashion instead of using an exchange or a middleman as a medium. OTC trading has been present since the very beginning, even before Bitcoin hit exchanges, as that has been the only way to accumulate the asset. According to a tweet by crypto researcher Eric Wall, the TABB Group concluded that around 1.5MM BTC is traded through OTC channels daily.

(Localbitcoins OTC trading volume graph from coin.dance)

So even now, after there are tens or hundreds of exchanges, Bitcoin is being traded OTC all over the world for several reasons:

► OTC buys and sells won’t show up publicly in the exchange books and graphs

This means that OTC buyers and sellers can hide their intentions during their accumulation or sell off periods. This will not pressure or delay pressure on the markets.

► OTC deals won’t affect the price instantly

Another very important aspect of OTC deals is that coins can be easily purchased or sold on a fixed price instead of pushing the price in either direction with bigger quantities.

► Fiat money or Digital Assets can be directly received to one’s desired bank account or online account

Those who sell or buy crypto can decide to receive their payment to their desired account instead of having to go through 2-3 working days to get their fiat money with the help of an international transfer

► OTC trading is cheaper compared to exchanges

OTC trading always has lower fees, even if it goes through an escrow medium, compared to exchanges if you count in deposit, withdrawal and trading fees.

Existing OTC channels

OTC trading is of course possible through truly peer-to-peer channels, but it can be done with the help of companies that offer certain security measures for those who wish to make sure everything goes well. There was an article recently that showed us the case of a South Korean trader and cryptocurrency firm owner who tried to sell $2.3 million worth of Bitcoins for 2 million euros in cash. The story ended with him receiving counterfeit money and the seller, who was a Serbian citizen, was caught later in Cannes in the ownership of a luxury watch and a sport car.

Since Bitcoin’s have a high price and a lot of additional value attached to them, it is important to make sure that you can’t be scammed through improper trade channels. One of the probably best channels to do this is the new Huobi OTC platform from Huobi Global.

While websites like Localbitcoins.com have been ruling the space for long, we have to say that it was refreshing to see new competitors surfacing recently.

While going through the Huobi OTC platform we noticed that the new service of one of the biggest Digital Asset exchanges to date is offering a competitive 0 Transaction Fee policy coupled with 24 hour professional customer support. KYC seems like a must for both sites for trading (at least for bigger quantities), even though Localbitcoins was once the safe heaven for anonymous trading.

What we additionally saw is that even though Huobi OTC is better, it is still fresh and has yet to be noticed by the majority of the traders, it already offers a wider range of cryptocurrencies including BTC, ETH, USDT, EOS and HT compared to the Bitcoin only policy of Localbitcoins.

Payment opportunities include Bank transfer, Alipay, Wechat, PayPay, Western Union, SWIFT, PayNow, Paytm, QIWI, Interac e-Transfer, IMPS and UPI. Fees for BTC, ETH, USDT are 0 (both Maker and Taker), while fees for EOS and HT are 0.2% for Maker and 0% for Taker. The biggest competitor, Localbitcoins, charges 1% for every trade in comparison.

Also worth note mentioning that both platforms offer some form of security for dispute handling. After we showcased the story earlier, it is important to do research and only trade through channels that are respected within the industry.

Our Takeway

Of course these 2 are not the only ventures on the market, which aim to deliver a seamless and cheap trading experience, since we also have itBit, CircleTrade (for major investors) and OKEx C2C, but we found Huobi’s OTC market to be an interesting addition to the space and we hope that it will take off as a competitor to Localbitcoins. A thing to note here is that Huobi’s expansion in the crypto space is standing on many legs currently and is worth a follow.

If you are interested on signing up to Huobi Global and Huobi OTC, you can do so here: Huobi Global