Crypto OTC Market Three Times Larger Than Exchange Market

According to a recent TABB Group research report titled "Crypto Trading: Platforms Target Institutional Market", the Bitcoin over-the-counter market is approximately three times larger than the exchange market.

While cryptoasset exchanges process around $4 billion worth of bitcoin trades per day on a global basis, TABB's evaluation is that the OTC market processes $12 billion worth of bitcoin trades daily.

Due to the concentrated ownership of the Bitcoin network, whales can substantially move the market with a single large trade of a few hundred million dollars.

Instead of selling Bitcoin on an exchange, whales prefer to sell cryptoassets over-the-counter to prevent any drastic moves or sell-offs in the market.

Reddit users began picking up on this unusual activity, which was enough to spook the market.

You can imagine the reaction if the wallet-holder decided to sell these Bitcoins all at once on an exchange.

The imminent inflow of institutional money into the crypto space is likely to lessen and ultimately eradicate the ability of whales to profit via manipulating the market.

As soon as more institutional investors enter the space, the market will be less concentrated and whales will have less control of the market.

There are certainly a few items that institutional investors have their eyes out for before committing to crypto.

While the over-the-counter market for Bitcoin is currently roughly three times larger than the exchange market, things should change when a myriad of institutional investors enter the cryptosphere.