Traditional investors prefer using over-the-counter (OTC) trading in bitcoin markets. According to research firm Diar there’s now more liquidity in OTC trading, where investors physically trade bitcoin. There’s growing investment in this type of trading on cryptocurrency exchange Coinbase, which outperformed Grayscale’s Bitcoin Investment Trust (GBTC) in terms of trading volume for bitcoin (BTC).
In 2017 Coinbase and GBTC were close to each other in terms of BTC trading volume. But this year Coinbase surpassed the established Grayscale investment trust and saw an increase of 20% compared with last year, while GBTC saw a drop of 35%.
Diar believes investors are holding of a bit right now, and some might have moved to other OTC opportunities with more trading volume. Every major exchange now offers OTC trading opportunities for BTC. Even though Coinbase is reporting growth on OTC trading, they also recognize that this type of trading is more difficult now.
On Coinbase 70 percent of all trading happens during office hours. Trading however, can occur on any given moment. That’s the nature of the cryptocurrency market: it never sleeps. That’s why Coinbase offers online trading and OTC trading, to attract each type of investor.