Pros and cons of Bitcoin over the counter market
Bitcoin has been one of the most significant technological breakthroughs of the last years. Now it is crystal clear that this technology is not a questionable innovation, but a reliable payment system and one of the greatest decisions for investment.
If you have already decided to learn a little more about cryptocurrency, you are definitely interested in how to enter the market. Actually, there are two ways – regular Bitcoin exchanges and OTC markets. If you choose the last – OTC, which is short for Over-the-Counter, you will be in need of bitcoin otc broker service. This will provide you with a smooth, effortless, and quick experience of selling or buying cryptocurrencies.
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Thus, only one choice has to be made: BTC exchange or OTC? Let’s find out all the pros and cons of the last!
So what are the main advantages of the Bitcoin OTC market?
- No third-parties
Usually, three parties are involved in the cryptocurrency buying-selling process. The deal between the one willing to buy crypto and those willing to sell some is arranged by an exchange that acts as a market. One of the major benefits of OTC desks is that they cut off the middleman, the exchange. Sellers and buyers can cooperate without any third parties, which means faster cooperation and less commission.
OTC market is an alternative to standard Bitcoin exchanges. However, to use it, you don’t need to share any personal data as you will be connected directly to the other party of the deal. After that, you can arrange the deal in whatever method convenient for you – through e-mails, chats, phone calls, anything. There is no need to register somewhere or provide your personal information to any websites or companies.
In contrast with regular exchanges, using the OTC market, you will be able to trade large amounts of Bitcoin without slippage and in short periods of time. Thus, you could convert your assets into cash effortlessly.
- Greater opportunities
Regular cryptocurrency exchanges have strict limits of withdrawal and orders, while OTC desks do not. As the deal is regulated between the parties only, you can do with your assets whatever you want without any limits, which is comfy. For example, you could transfer your assets with no order limits.
However, the Over-the-Counter market presents several disadvantages, as well. So it is essential to be aware of them before you decide:
- Time-consuming at times
If you decide to transfer great amounts of Bitcoin, OTC is a better choice. However, you will be forced to wait – processing large transactions might take time.
- Affected by volatility
As the number of available Bitcoins might change rapidly due to transactions of large amounts, the price for a coin might also change. This is why OTC desks are easily impacted by volatility – you never know the deal’s exact price on the eve. However, this issue is not new to cryptocurrency enthusiasts, as all the market is prone to it.
- Higher risks
Fewer regulations are not only the advantage of OTC trading, but a disadvantage as well as this means the customers are at a higher risk of fraud. Always check the details of your deal carefully to minimize the chance of scam.
As you can see, the Bitcoin Over-the-Counter market has some drawbacks. However, they are fully compensated with the great benefits this opportunity provides. OTC exchanges are a perfect choice for those who want to deal with minimal time and money spendings. Moreover, it is much more convenient and offers less formality.