The Diar market report of December 17th published bitcoin trading volume data on the OTC platforms, i.e. over-the-counter, of Coinbase and Grayscale’s Bitcoin Investment Trust (GBTC) in 2017 and 2018.

These data show that, excluding the period of the speculative bubble, over the past few months, OTC trading on Coinbase has increased, while that on GBTC has decreased.

In 2017, trading volumes on the two platforms were very similar, but this year they went in opposite directions.

Coinbase, during the hours when the OTC market was active, saw a 20% increase in bitcoin trading volume while GBTC volumes decreased by 35%.

According to Diar analysts, this decline could suggest that institutional financial operators have moved to OTC physical bitcoin markets, decreasing purchases of GBTC derivatives.

This shift could be a sign that large investors are increasingly seeking to trade directly with BTC in markets with greater regulatory clarity, secure custody solutions and insurance coverage.

Exchanges operate 24 hours a day, 7 days a week, while OTC platforms remain open for trading for only 31% of the exchange’s operating hours.

In fact, over-the-counter trading platforms do not function like exchanges, but only allow direct trading between two parties.

On an exchange, when you make a buy or sell order, it is executed by the exchange itself, which anonymously and unconsciously connects all potential sellers with all potential buyers, using prices to determine which orders to execute automatically.

In an OTC market, however, each buyer must search and find a seller, decide the price, and execute the transaction. The OTC desks help manage the process and act as a guarantor of the transaction itself.

Given the highly unstable market, however, this could be an obstacle for institutions operating via OTC.

All major exchanges in the United States now also offer OTC services, but many traders still choose to use only the exchanges themselves.

For example, Max Keidun, CEO of the peer-to-peer exchange, Hodl Hodl, who also has an OTC desk, said that demand for large orders grew exponentially in 2018, doubling month-to-month. But he added, “It’s quite harder than usual to find a seller at current prices”.