Cryptocurrency OTC desks are trading Billions through Skype

Traders making millions via Skype

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Cryptocurrency big players who include traders and miners have formed their own private network mainly for OTC trading. It mainly includes buying and selling of Bitcoin and other currencies every month in their club. But what’s more interesting is that they do not use Symphony or Bloomberg or the other main platforms used by other traders, they just use Skype.

The trading platform consists of a small group of about twenty over the counter traders who include miners, investors and payment processors which include hedge funds. The group has already reached a monthly trading volume worthy over billions of dollars. These groups decided to avoid using online exchanges like Kraken or even Coinbase opting to close their major deals on Skype. These transactions are settled through Skype with the investors opting to send fiat money via banks wires and digital currencies direct to each other.

According to reports reaching our news desks, these groups are now handling an excess of $100 million per day. The average trading per day has been estimated to be between $80 million daily. The total trade in December last year is estimated to have hit around $2 billion. More to that Circle traded OTC up to $4 billion monthly over last year according to DCG’s spokesperson Jennifer Hanley.

To reduce the chances of problems, most of the OTC groups record calls and also register with the US regulators as well as following all compliance standards. More to that they also decide to trade very few coins with most trading only Bitcoin and Ethereum. Cumberland mining global through their head of trade, Bobby Cho explained that they prefer Skype as their chatting platform because it’s a global platform and it’s also reliable.

What are the benefits of OTC?

It’s evident that trading outside the exchanges can be a very risky thing. The main aim is always trying to reduce the chances of losing funds in case the exchanges are hacked or even any other incident which can bring a well-established exchange down. One OTC trader explained that to them when one exchange is hacked business goes up.

The use of OTC may also be good for whales to avoid the big waves by ensuring that they keep their trading private. According to Kevin Zhou who is the founder of cryptocurrency hedge fund Galois Capital:

“In general people decide to use an OTC desk when they have a large block trade they want to do without moving of affecting the market trend or even without have to incur too much slippage.”

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