🧠 Topic: What are OTC transactions, how do they affect the market, and why do large players not always buy 'on the exchange'

📦 What is OTC?

#OTC (Over-The-Counter) — these are off-exchange transactions, that is, direct purchase/sale of cryptocurrency between two parties, bypassing the exchange.

Example: the fund wants to buy 10,000,000 USDT for BTC — but does not place an order on #Binance and does this directly with the seller.

❓ Why are OTC transactions needed?

💡 1. Avoid slippage

Exchanges are order books.

If you buy 1000 BTC at market price, the price will skyrocket.

OTC deal allows you to buy the entire volume at a fixed price.

🕶 2. Maintain privacy

OTC transactions are not visible in exchange charts and volumes.

Large players often do not want to 'shine' their movements.

🧠 3. Negotiate on special terms

For example:

Discounted price

Deferred delivery

Vesting or locking part of the tokens

Fixing the rate in advance

🏦 4. Funds, OTC desks, and CEX

Many exchanges (Binance, OKX, Kraken) have their own OTC desks for VIP clients.

There are also independent platforms and brokers (Amber Group, GSR, Wintermute).

🔍 How does OTC affect the market?

🟢 Pros:

Reduces pressure on exchanges

Allows moving large amounts without volatility

Institutions can enter and exit without alarming the market

🔴 Cons:

Not visible in the chart, but large OTC deals can indirectly affect it

(for example, after an OTC purchase, tokens may hit the exchange and cause a dump)

Not always transparent — hard to track volumes

🧠 How to track OTC activity?

Watch for unusual token movements between wallets

Use analytical tools:

Arkham, Nansen, Lookonchain

Keep an eye on the news: if a project or fund announced an OTC deal — this is a signal.

🤔 Real-life example

In 2020, #MicroStrategy purchased $BTC for billions of dollars.

But not through the exchange, but through the Coinbase OTC desk.

The market did not feel this — until they announced it publicly.

🧠 Conclusion

OTC is a tool for large players to trade 'in the shadows', without moving the market.

But their actions still leave traces — learn to find them.

📖 In the next issue, I will tell: How decentralized derivatives work, why crypto futures are needed, and how not to lose your deposit on 100x leverage.

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