Over-the-counter (OTC) trading is a process in which two parties enter into an agreement to purchase a specific asset without the use of a centralized exchange (CEX). OTC desks are typically used to purchase large quantities of an asset in order to improve transparency, save time and fees, and ensure the asset purchased is secure. OTC trading is typically accompanied by a third-party custody solution. Furthermore, OTC desks frequently trade assets or securities that are not listed on regular crypto exchanges due to smaller exchanges not meeting the regulatory requirements to list the specific asset.
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