A recent conversation shone a new light on over-the-counter, or OTC, bitcoin trading — suggesting much of the large-scale movements between fiat and cryptocurrencies happens away from the exchange books.
Also read: 4 Reasons Why Bitcoin is Outperforming Everything
Entrepreneur and well-known bitcoin investor Vinny Lingham — co-founder and CEO of Civic Technologies, and former CEO of Gyft — highlighted the issue with a blog post on June 27 titled, “The 1% Don’t Use Bitcoin Exchanges.”
Lingham confirmed what anyone who has spent years watching bitcoin already knows: that there are very wealthy people out there investing in bitcoin, and they’re keeping it low-key. Serious money is moving into cryptocurrency.
His main point, however, was that the regular (ie: on-exchange) bitcoin market is simply not large or liquid enough yet to process large trades. To place a seven-figure dollar trade would shift the price in a direction unfavorable to the trader before the trade is completed, a phenomenon known as slippage.
In fact, “regular eight-figure trades are now common” on the OTC market, he wrote. 66 percent of the OTC trade this year has been buyers, and more entered the market after
Read more ... source: TheBitcoinNews
Advertise on the Bitcoin News
Do you like The Bitcoin News ? Thank you for Support us !