Cryptocurrency platform Coinbase has announced they will now offer over-the-counter (OTC) trading for its Prime customers.
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“We launched our OTC business as a complement to our exchange business because we found a lot of institutions were using OTC as an on-ramp for crypto trading,” said Christine Sandler, head of sales at Coinbase.
“We felt this was a huge benefit to our clients to actually leverage both our exchange and our OTC business.”
Sandler stated the company plans to increase services to offer delayed settlement and
OTC trading happens amongst two parties directly, instead of over an exchange and normally occurs between an investment bank and its clients.
This month, the company also began to allow trading of any asset that trades on Coinbase Prime and order books through its web interface, email, Skype, Bloomberg IB, or phone, according to documentation shared with some clients.
“Trades settle seamlessly and instantly, with funds available for immediate withdrawal” the documents stated.
Coinbase is not the first to offer OTC trading services. Competitors such as itBit, Genesis Trading, Kinetic Capital, Circle, and others already offer these services.
So what makes Coinbase’s OTC trading different?
“Circle and a number of others have complementary products, but they also trade on a proprietary basis, so they are the counterparty to each transaction, while we, in fact, are matching client orders,” Sandler stated.
“From our crypto first clients, we’re hearing that nothing has changed with respect to technology, and they’re still absolutely committed to crypto … to the technology. I think that there’s one small silver lining to this volatility … [it’s] that crypto’s been front and center of the mainstream financial media for the last few weeks. I think that has driven … forced a lot of institutions to think, really, is this an opportunistic investment point for crypto at this point.”