If you wish to trade cryptocurrencies or looking for the best crypto exchange australia, you can choose to make transactions over a centralized exchange or via over-the-counter trading. What you choose for your means of interaction will depend on your wish for privacy and the amount of money you’re investing. Both types of trading platforms have their advantages and drawbacks.

You must remember that trading on a centralized exchange is public. While the buyer and seller trade anonymously, the work details are cast into a public forum. If you’re a higher net worth investor, OTC transactions offer more discretion and privacy. 

Why OTC Trading Is a Popular Trading Choice

As a result, OTC trading is a popular choice for anyone who invests in more significant volume transactions or has a more sizable trade. Professional investment service companies, such as Zerocap, offer investors OTC services that make investing in crypto much more confidential and comfortable. People with more money to invest like this type of personalized service.

How to Prevent Problems with Slippage

If you’re interested in making larger trades, you are more likely to prefer OTC trading over a centralized exchange. This is because digital exchanges feature price slippages. For example, when a business is done, the crypto price can change between the placement and execution of the crypto order. 

This can lead to a problem for crypto whales – individuals or institutions that hold large amounts of crypto tokens. For example, a Bitcoin “whale” represents crypto holding over 1,000 Bitcoins.

As you can imagine, this can create a large “wave” of anxiety, if not an unsettling ripple effect. A centralized exchange may not have enough crypto available or an insufficient number of traders to purchase an asset for a trade transaction.

OTC Trades Offer More Liquidity

Alternatively, an OTC trade enables crypto traders to enjoy more liquidity, allowing investors to experience a positive trading experience.

As a result, almost anyone who enrolls in a crypto account and passes identity verification can trade on a centralized exchange. OTC desks, however, set a higher limit on crypto transactions, trading crypto in tens or hundreds of thousands of dollars.

A centralized exchange assesses fees for withdrawals and wire transfers, while OTC traders pay one fixed price or percentage for each trade. The OTC fee is usually higher than a fee charged on a centralized exchange because the service is more personalized and attentive.

Centralized Crypto Trading – When to Use It

You will fare well trading crypto on a centralized exchange if you are a newcomer in crypto trades. A centralized business offers a wide range of currencies. If your investments are smaller, you can execute orders conveniently.

When to Use the OTC Trading Desk

If you opt for OTC trading, you’re making a good choice, especially if you wish to make one-on-one trades or keep your trading confidential. OTC trades also make it possible to place more significant transactions without worrying about a slippage, reducing a trade’s value.

Successfully Executing Crypto Trades

If you’re a serious crypto investor, choose OTC trading for your crypto buys and sells. Doing so is less stressful and results in better outcomes.