In an interview with Cheddar on Nov. 27, Christine Sandler, the head of sales at Coinbase revealed that the US-based crypto exchange had quietly opened its OTC desk this month. The new product will act as a compliment to its exchange business and will make it easier for institutional investors to purchase crypto assets.
According to Sandler:
“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. We felt this was a huge benefit to our clients to actually leverage both our exchange and our OTC business.”
Coinbase Now Joins Circle And Other Firms In Offering OTC Services
Normally, OTC transactions take place between two parties directly. It’s different when compared to an exchange where orders are usually matched between third-party buyers and sellers.
As of now, the OTC service is only available for Coinbase prime customers like financial institutions that look to trade with business funds.
“Trades settle seamlessly and instantly, with funds available for immediate withdrawal” and “no possibility of a failed trade and no need to chase down wires and blockchain transfers.”
Moving forward, she adds that the service will likely be integrated with Coinbase Custody.
The Coinbase Custody was launched in July, and it targets hedge funds and other high net worth clients.
The crypto exchange initially revealed plans of launching an OTC trading desk in June. At the time Asiff Hirji, the company’s chief operating officer claimed that acquiring regulatory licenses would help the firm take a “path to offer future services that include crypto securities trading, margin and over-the-counter (OTC) trading, and new market data products.”
In late October, the exchange was given the go-ahead to form a custodial firm for digital assets by the New York State Department of Financial Services.
Now, the exchange and joined other notable cryptocurrency firms that are already offering OTC services. The likes of Circle which is backed by Goldman Sachs. The firm has Circle Trade that caters for both individuals and institutions.