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Victim of the “largest theft in history”, Japanese cryptocurrency exchange Coincheck has launched an OTC (over-the-counter) desk as a gateway to the cryptosphere.
The new trading desk gives major institutional investors a way to invest large amounts of money in Bitcoin (BTC).
Coincheck wrote in their announcement:
“We are pleased to announce that Coincheck (WEB) has launched a large-scale OTC trading service for large-scale customers. Large-scale OTC trading service is a service that allows you to buy and sell virtual currencies at attractive prices for large-scale customers.”
From the compan,y they said its OTC trading desk will allow customers to buy and sell a minimum of 50 Bitcoins ($205,423 at press time) “quickly” at one go and at “attractive prices.”
The service is available on weekdays between 10 a.m. (13 UTC) and 3 p.m. (18 UTC) Japan time.
For now, transactions on the OTC desk are limited to Bitcoin. Coincheck suggests service offerings could be expanded in the future:
“We will consider the handling of other virtual currency from time to time. Overtime trading and trading from other than the large OTC trading screen are not eligible.”
In an OTC trading service, two parties trade directly with each other, unlike on an exchange where orders are matched between buyers and sellers.
Just for a reminder, in January last year, Coincheck suffered a $530 million hack, losing around 500 million NEM tokens from its digital wallets. However, the exchange was then acquired by Monex Group, a well known Japanese broker, in mid-April 2018. The cyber-attack forced Coincheck to suspend its services for some months. By November, however, it had reinstated services for all listed cryptos on its platform.
Monex Group then rehauled its shareholder composition, as well as management. Additionally, the broker took a number of steps to resolve the security issues, and improve the trading systems.
Last week the broker also announced major changes in its management structure. The current representative executive officer and president of Monex group, Oki Matsumoto, will now also be the representative director and chairman of Monex, as well as chairman of Coincheck.
Per the announcement, within Monex, “diverse employees will be aggressively promoted to managerial positions.” The press release also reveals that three Coincheck executive directors will also serve as executive directors of Monex to enhance cooperation between group companies. The current senior executive officer and chief investment officer of the company, Koichi Tateno, will resign and become a senior advisor.
Coinbase, Binance and Bittrex All Launching an OTC Desks
Coincheck follows a host of virtual currency exchanges that have veered towards institutional investors in launching an OTC trading desk. As previously reported, major United States crypto exchange and wallet provider Coinbase launched its own OTC services for institutional clients in November 2018, having gone through a process to become a fully regulated broker dealer by the U.S. Securities and Exchange Commission (SEC) last year.
Binance, the largest exchange in the world, had earlier launched their own OTC desk. However, the minimum threshold for BTC trades on Binance was 20 BTC. Bittrex has also launched institutional trading services recently.
It seems that institutional investors are now moving towards over-the-counter platforms for trading Bitcoin, as it is a more sustainable way of operation in a market that is currently in the middle of a liquidity crisis.
Huobi, Etoro and Hodl Hodl Also in the OTC Game
Their newly founded branch HBUS will focus on introducing new services for institutional investors, such as token lending, over-the-counter (OTC) trading, and even issuing its own stablecoin.
Prominent exchanges as Etoro and Hodl Hodl last year also announced that they will be offering the functionality of an OTC trading desk to their consumers. Exchange platforms have ceased to hold the bulk of institutional money, as seen by the 20% increase in trading volume during OTC market hours.