CoinDCX Is Launching India’s First OTC For Institutional Investors

At a time when India is fueling one of the world’s fastest-growing crypto regions, CoinDCX, India’s first crypto unicorn, has launched an over-the-counter (OTC) desk to facilitate bulk trades by institutional investors.

What is CoinDCX?

Sumit Gupta and Neeraj Khandelwal co-founded CoinDCX, a cryptocurrency exchange platform, in 2018. It is India’s largest cryptocurrency exchange, with a market capitalization of $1.1 billion, and one of the most popular cryptocurrency exchanges in the country.

According to a statement released on Wednesday, the facility complements CoinDCX’s existing trading platforms, CoinDCX and CoinDCX Pro, and is targeted at growing the company’s user base and trading volumes. Institutional clients will now be able to place large bitcoin and other crypto token orders without fear of price volatility.

Source: Mint

What is an OTC desk?

An OTC desk is typically utilised when a certain trade is not available on exchanges. This could be because the asset isn’t traded on any exchanges. An OTC desk works as a dealer for anyone wishing to trade a specific item, rather than matching buyers and sellers. To reduce market risks, a trader may choose to trade “over the counter” if the order is large.

CoinDCX seeks to get into this underserved sector and enhance its trading capabilities, “with the dual benefit of ample liquidity and ability to place limit orders for large trading volumes” read a statement.

“The average ticket size for such services start at Rs 30 lakh plus investments. With this, our target audience lies with an entity which trades in and out of crypto for large quantities,” said Sumit Gupta, cofounder of CoinDCX. “This segment is more concerned about price certainty and wants to minimise slippages.”

Indian family offices and wealthy individuals are flocking to cryptocurrencies, and crypto exchanges are greeting them with personalised services. They’ve observed an increase in investments from family offices and wealthy people — up to Rs 1 crore — as worldwide institutional adoption of crypto grows.

According to a recent report by Chainanalysis, a New York-based blockchain data platform, India has emerged as one of the world’s fastest-growing cryptocurrency markets.

“Large institutional-sized transfers above $10 million worth of cryptocurrency represent 42% of transactions sent from India-based addresses vs 28% for Pakistan and 29% for Vietnam,” it said. “Those numbers suggest that India’s cryptocurrency investors are part of larger, more sophisticated organisations.” These findings were confirmed by CoinDCX’s Gupta.Indian companies, he claims, want a portion of their assets to be held in cryptocurrencies. Local startups, as well as their founders, are interested in diversifying their portfolios to include this asset class.“We have also seen small proprietary firms or individuals make money by trading across exchanges — utilising price differential to make arbitrage profits,” he said.

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