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What is Ethereum Over-the-Counter Trading (Ethereum Over-the-Counter at 5% Discount is Illegal)

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What is Ethereum Over-the-Counter Trading? What is Ethereum Over-the-Counter Tr

What is Ethereum Over-the-Counter Trading (Ethereum Over-the-Counter at 5% Discount is Illegal)

What is Ethereum Over-the-Counter Trading? What is Ethereum Over-the-Counter Trading (Exchange)?

Why do we need to conduct OTC transactions with ETH? Why do we need to trade on the Ethereum network’s exchanges? Ethereum is a decentralized cryptocurrency that possesses the same functionalities and value as Bitcoin, but it also allows people to use smart contracts for executing complex financial tasks, lending, or trading derivatives.

Ethereum is an important component in blockchain technology. It enables developers to build their own applications and launch services directly on the platform, providing scalability, flexibility, and security (if a user wants to run a complete service starting from an application).

What is Ethereum Over-the-Counter Trading?

Due to the high transaction fees, most Ethereum miners are unable to participate in any type of market activity. Therefore, to attract investors, many people have chosen non-custodial wallets, custodial solutions, and other methods to achieve this goal. However, despite the high gas fees and lack of transparency, most people consider this approach to be safer and more costly because there aren’t enough third parties to handle a large volume of transactions. For example, in decentralized exchanges like Uniswap, some liquidity pools may not support transactions, making it difficult for traders to utilize their funds.

These tools have become increasingly popular and interesting for users as more customers join the Ethereum ecosystem. However, for those who want to deposit Ether into an exchange, this method remains a challenge. Even in the traditional financial world, there is no “bank” account to manage digital assets, and traditional bank accounts can also serve as a deposit institution for holding digital assets and generating income. This is why people have to pay gas fees to large companies, and there could be issues when large corporations seek financing.

In addition, due to the involvement of complex technologies including smart contracts and code-based products in order to easily access various functionalities of Ether, Ethereum may lead to price fluctuations, ultimately resulting in losses.

In addition to the aforementioned reasons, many terms in the crypto field are widely used to describe differences between counterparties in transactions. “Exchange” refers to trading parties exchanging on one side and then another person trading on the other side. This concept is often likened to an “exchange” by Ethereum’s co-founder, Vitalik Buterin.

The anonymity nature of Ethereum makes certain traders in this field easy targets for exchanges. Although many professionals already know that exchanges only accept small-scale users, you can achieve this by transferring ownership to individuals or companies. So no matter what you do, there will be a publicly visible website – Ethereum Foundation, or just a simple copy-paste.”

What drives the adoption of Ethereum transactions?

Ethereum Over-the-Counter Trading at 5% Discount is Illegal

According to news from The Paper, a company in Hangzhou is under investigation for conducting OTC sales of Ether on an Ethereum trading platform. According to the police, since April 27, 2019, the company has been issuing Ether “9.5% discount on transaction fees” coupons to users via WeChat, Alipay, and other methods. According to relevant regulations, after collecting fees from participants, the company should refund the investors based on the settlement price of that day; If it provides services for purchasing ETH within the platform and fails to withdraw or pay interest in a timely manner, it shall return the plaintiff’s funds according to the actual transaction amount on that day.

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