Cryptocurrencies and blockchain technology are paving the path towards a digitally-led sound economy and revamping the web as we know it. The sector has evolved from a fringe cypherpunk movement to TradFi institutions recognizing crypto’s utility as a vector for lucrative returns. As we enter a new phase of maturation in this sector with huge sums of institutional capital flowing into the market, several platforms known as Over The Counter or crypto OTC desks have emerged to facilitate these large transactions seamlessly. Encryptus is one such platform bolstering crypto adoption by providing a simple and compliant avenue for institutions and high-net-worth individuals to enter the space.
The top crypto OTC trading platforms provide efficient on and off-ramp services for institutions. With a mission to hasten crypto adoption, top OTC desks like Encryptus, Bitcoin Reserve, sFOX and Cumberland provide an intuitive way for the next wave of institutions to convert their fiat capital into crypto and vice versa.
What is a Crypto OTC Desk?
Before we dive into the Encryptus platform and other top crypto OTC trading services, it is best to understand the need for such platforms and how they differ from traditional cryptocurrency exchanges. In its simplest form, any crypto trade carried out away from a traditional crypto exchange or spot trading terminal is known as an OTC trade.
The primary difference between OTC and other forms of crypto trading is that it expedites the trade of large volumes of crypto directly between a buyer and seller. When carrying out a crypto OTC trade, the price of acquiring or selling crypto is determined by the buyer and seller and not influenced by the broader market. The OTC platform or desk, serves as a mediator to link the two parties.
Crypto OTC trading desks exist simply because buying or selling large amounts of crypto on traditional centralized exchanges comes with a set of challenges. Firstly, most exchanges set a strict cap on the volume of crypto that can be purchased within a day. While the trade volume limit is perfectly fine for smaller retail investors, this is not feasible for institutional capital.
Secondly, purchasing large sums of crypto in a single trade on a traditional exchange is highly improbable. For instance, if you were looking to purchase 300 BTC, the odds of a counterparty looking to sell 300 BTC at once are highly unlikely. This would result in you purchasing the 300 BTC over several small trades. Consequently, you will be paying higher fees for each trade and likely purchase each chunk at a higher market price – this is known as slippage.
Crypto OTC desks also offer the added benefit of providing an extra layer of confidentiality since trades are not made public on an order book. This is particularly suitable for traders who carry out large-scale transactions without significantly impacting and distorting the market price of the crypto asset. Overall, OTC trading platforms are a convenient way to carry out large transactions at a single price and in one trade. With the recent influx of institutional interest in the space and the proliferation of crypto whales, OTC trades emerge as a practical method to conduct large transactions.
3/ This is the year when institutional adoption finally happened. While still extremely speculative, the space is now infinitely more mature than ever before. Unlike in 2017 when it wasn't clear yet, it's now obvious crypto is not going away. pic.twitter.com/ypcwzqkUkQ— Larry Cermak (@lawmaster) December 16, 2021
Top Crypto OTC Platforms
Encryptus launched in 2020 and has rapidly ascended to a leading crypto OTC desk. Encryptus places transparency at the forefront alongside its core mission of enabling crypto adoption. Encryptus’s resolute stance on regulatory compliance stands out from its competition.
Encryptus’s OTC desk is fully licensed for crypto activities in the UAE, Australia and authorized in the EU with the aim to expand operational bandwidth shortly. Furthermore, the dedicated compliance team undertakes rigorous KYC/KYB checks and thorough evaluation of tokens before being listed. Encryptus does not custody assets giving complete autonomy to its customers.
Encryptus is seamlessly connected with large traders and supported by several exchanges for deep liquidity. The platform is well funded and they use their funds at banks and Liquidity Providers (LPs) to execute the large buy and sell orders.
Encryptus simplifies the entire process from registration to executing a buy or sell order. By following a simple set of steps, institutional investors and high net worth individuals can step into the crypto ecosystem with minimal effort.
Encryptus desk offers support for major cryptocurrencies such as Bitcoin, Ethereum, Polygon and USDC against fiat currency pairs like USD, EUR, GBP, INR, HKD or SGD. The platform is looking to integrate more fiat pairs soon to further bolster crypto accessibility. The minimum amount to execute an order on the platform is $10,000 with a very competitive transaction fee of only 1%.
An outstanding feature of Encryptus is its fast and efficient on and off-ramp solutions for investors.
Furthermore, Encryptus has set a new industry benchmark for innovative crypto off-ramp solutions with its recently launched payout product, QuickRemit. This service enables crypto exchanges, wallets, and other B2C crypto companies to smoothly off-ramp to bank wires, mobile top-ups, bill payments, and gift cards. The payout network has massive coverage which expands to bank wires in 79 countries and 41 currencies, mobile wallets in 39 countries, and mobile top-ups and gift cards in 115+ countries.
Unlock the power of choice with @EncryptusGlobal! Choose from our off-ramp capabilities- bank wires, mobile wallets, gift cards, or mobile top-ups , the possibilities are endless. Start experiencing a new level of convenience with #Encryptus today!#CryptoExchange #PayoutOptions pic.twitter.com/RBbtr42xEq— Encryptus (@EncryptusGlobal) June 9, 2023
Overall, Encryptus is making it easier for institutional clients to enter the crypto ecosystem while prioritizing security and regulatory compliance. With its advanced cash-out options, Encryptus is accelerating the usability and adoption of this industry.
2. Bitcoin Reserve
Established in 2018, Bitcoin Reserve is an Estonian-based crypto OTC trading desk for large Bitcoin transactions. The tradable assets on the platform are Bitcoin, Liquid Bitcoin, Tether USDT, and Liquid USDT.
To successfully register, users must provide an ID document such as a passport, driver’s license, or permanent residence card. Signing up for an individual account usually takes 5 minutes while corporate accounts can take up to 48 hours.
While there is no minimum trade amount, transactions of a monthly volume of over 10,000 USD or EUR come with personalized services such as one-to-one 24/7 customer support. The crypto OTC platform also follows a tiered fee structure model ranging from 2.99% to 0.65% depending on trading volume.
The platform also takes the proverbial phrase “not your keys, not your crypto” seriously. All the purchased Bitcoin is transferred to a user’s private non-custodial wallet with a dedicated representative providing expert guidance on the most secure crypto storage options.
sFOX is a United States-based crypto OTC service established in 2014. sFOX operates as a crypto trading platform, which aims to compile the best crypto prices from the world’s top exchanges. sFOX integrates the crypto ecosystem into one easy-to-manage account and thereby aggregates deep liquidity from various sources. In terms of tradable assets, sFOX not only offers over 40 cryptocurrencies but also a wide array of tradable pairs. The entire list can be found here.
The sFOX platform has a sleek interface, robust order types designed for discreet trades, and provides institutional traders with a swift trading experience and comprehensive analytics. Furthermore, the platform emphasizes compliance and digital asset security. It offers complete bankruptcy protection for $250,000 worth of assets under custody.
Cumberland is another top US-based crypto OTC platform. It was launched in 2014 as a subsidiary of the established diversified trading firm, DRW. Like the other top OTC platforms on this list, Cumberland offers a seamless trading experience for institutional investors with 24/7 access to relationship managers.
Cumberland offers OTC trading in BTC and 150+ cryptocurrencies with support for multiple fiat currencies (USD, EUR, GBP, CHF, JPY). The minimum order size to execute a trade on the platform is $100,000.
Apart from the specialized crypto OTC services mentioned in this article, top cryptocurrency exchanges like Coinbase and Kraken have launched their own subsidiary OTC brokerage services. The emergence of new OTC desks epitomizes the growth of the crypto sector. With institutional capital entering the space, crypto OTC platforms like Encryptus provide viable solutions to conduct large-scale transactions effortlessly and securely. Technological progress is realized by making access cheaper and easier.