Over The Counter trading (OTC) refers to a transaction of digital assets that do not happen on an official exchange. Rather, it happens through agreements between a buyer and a seller. The buyer must be willing to buy shares at the price the seller is offering. Over the counter trading is very beneficial to you as a cryptocurrency investor, as it gets you to the ground floor of a booming and winning asset class.
These are high-performing and high-growth emerging cryptocurrencies and technologies at a cheaper price tag. Trading digital assets on any exchange will inherently be more expensive than directly over-the-counter trading and that is why, as a crypto investor, you must know how to get the best deals off your crypto OTC trades.
Here are some tips to get the best deal when trading OTC:
Always have a strategy
Before putting in any money into brokerage and OTC trading, always have a clear strategy from the get-go, in which Zerocap can help you. How will this help me get the best deals? When you have a clear strategy from the start, market speculation and unplanned trades will not affect your trading budget, you will go through with only a few but worth it deals. Having a strategy will also ensure you are in it for the long term.
Manage Risk
Always choose trade volumes carefully and trade efficiently. Set limits on how much you trade a certain digital currency. But trading OTC is protected from the market volatility found on exchange platforms. This also allows you to trade in large volumes getting high returns. You only deal with one counterparty, unlike the thousands or millions found on public exchanges. OTC trading is relatively safe.
Make sure to find a reputable OTC trading broker or an investment company
An OTC trading institution must be trustworthy, as OTC trades usually happen in large volumes. Find proprietary leading firms with a background in dealing with block chain technology, digital assets storage and management, and cryptocurrency brokerage.
Reputable firms will be able to offer deeper digital asset liquidity and reduce transactional risks. Beware of online scams, fraudsters, and traders with malicious intent. Not everyone who wants to transact with you or offers advice online has the best intentions. Having a keen eye when choosing deals is key. Bitcoins (BTC) are the most targeted crypto as it has become ubiquitous.
Conduct deep research and learn
To get the best deals, you need to do a deeper market analysis. You need to differentiate between good and bad deals. Conduct deep research and learn about OTC trading. OTC trading can get very technical. OTC trades can either be crypto-to-crypto or crypto-to-fiat. Institutions also source liquidity for your assets and this can also be fragmented across different avenues. Read widely and in-depth. Also, not all currencies are traded OTC. OTC transactions usually concentrate on the most liquid trading pairs, this includes.
- BTC
- Ether (ETH)
- Bitcoin Cash (BCH)
- Litecoin (LTC)
- Tether (USDT)
- Stellar (XLM)
Conclusion
OTC trades offer deep liquidity on digital assets. It involves premium direct trading between two counterparties. Investment companies that have competitive pricing on large orders across a wide variety of digital class assets will help you find the best deal in OTC trading.