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Regulated OTC desks could spur crypto adoption


In the Philippines, an over-the-counter (OTC) exchange focuses on bringing crypto to mainstream eyes, while in the United Arab Emirates (UAE), an OTC provider focuses on the potential long-term impact of OTC on the crypto ecosystem. 

Example of a retail OTC trading shop in the Philippines. Source: Moneybees

In the Philippines, a budding crypto hub in Southeast Asia, physical OTC trading desks cater to those “less familiar” with crypto trading. According to Jay Ricky Villarante, the CEO of licensed virtual asset service provider (VASP) Moneybees, OTC platforms’ straightforwardness allows crypto trading to become more accessible to everyone, suggesting that it may also allow those less tech-savvy to engage in crypto trading.

Villarante also said that based on their observations with their clients, in-person OTC trading appeals to Filipinos because they “still value financial transactions.” The executive claimed clients are more confident when they see “real individuals” facilitating their trades.

The executive also highlighted that OTC hubs provide an easy and convenient way to bridge fiat into cryptocurrencies and vice versa. Villarante added that this allows newcomers to have an easy way to switch between fiat and crypto.

Physical OTC trading store in the Philippines. Source: Moneybees 

Villarante suggested that having a physical location also normalizes cryptocurrencies, indirectly influencing mainstream adoption. Villarante explained that being located within malls and other leisure areas like resorts and casinos allows them to somehow put crypto into the eyes of the mainstream crowd.

Meanwhile, Aminhossein Rad, the CEO of Dubai-based OTC platform Crypto Desk, believes there are differences in the short-term and long-term impact of OTC trading when it comes to influencing mainstream adoption. Rad explained that the short-term impact of OTC desks on the broader crypto ecosystem is “generally insignificant.”

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Rad explained that international online exchanges such as Binance, OKX and ByBit handle around 95% of the daily trading volume across the globe. “Crypto-fiat exchanges, including OTCs, are rather used as a bridge for users for on-ramping and off-ramping, which comprises a small portion of the worldwide daily trading volume,” he added.

However, the executive believes that in the long run, OTC desks will have more of an impact on the adoption of cryptocurrencies when they become more regulated. The executive believes that under Dubai’s leadership, OTC trading exchanges can help the UAE maintain its status as a global Web3 hub.

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