Coinbase, the well-known U.S.-based cryptocurrency exchange opened its over-the-counter (OTC) crypto trading desk for its Prime clients earlier this month.
In an interview with news outlet Cheddar, Christine Sandler, head of sales at Coinbase, declared that the company opened its OTC desk as an addition to its exchange business because institutions rely on OTC as an “on-ramp for crypto trading”.
The two parties perform a trade directly in an OTC transaction, unlike an exchange where orders are matched between third-party buyers and sellers.
During the interview, Sandler stated:
“We felt this was a huge benefit to our clients to actually leverage both our exchange and our OTC business,”
For the time being, only Coinbase Prime customers can use the OTC service although Sandler disclosed that they will probably integrate the service with Coinbase Custody, the institutional product available for hedge funds and other high-net-worth customers.
Coinbase first announced their plans to open an OTC trading desk back in June. At that time, Coinbase chief operating officer and president Asiff Hirji said that acquiring regulatory licenses will allow the company to take a “path to offer future services that include crypto securities trading, margin and over-the-counter (OTC) trading, and new market data products.”
Toward the end of October, Coinbase received approval from the New York State Department of Financial Services to form a qualified custodial firm for cryptocurrencies.
Other well-known crypto companies are providing crypto services including Circle, a Goldman Sachs-backed crypto finance firm. Earlier this year, the Gemini crypto exchange founded by the Winklevoss twins launched Bitcoin and Ethereum block trading which allows customers to perform high-volume trades that don’t show up in the exchange’s order book until they’ve been filled.