As crypto matures, revenue strategies for exchanges are expanding far beyond retail trading. Today, one of the most powerful drivers of institutional and enterprise revenue is the Over-the-Counter (OTC) desk. Originally designed to accommodate high-net-worth traders, OTC desks have become foundational to B2B exchange services—delivering bespoke execution, deeper relationships, and premium margin opportunities. For exchanges looking to scale in the enterprise market, OTC is not a side feature—it’s a core revenue engine.
What Are Crypto OTC Desks?
OTC desks are off-exchange trading venues that facilitate large-volume crypto transactions between two parties, typically above $100,000. Unlike traditional exchanges that use public order books, OTC desks offer private, negotiated deals—shielding high-volume trades from slippage, front-running, and market disruption. These services cater to institutional investors, corporates, family offices, and hedge funds that require discretion, scale, and certainty in execution.
There are two primary models. Principal desks use their own capital to fulfill orders and profit from bid-ask spreads. Agency desks act as brokers, sourcing counterparties and charging commissions for arranging the trade. In both cases, clients benefit from tighter pricing, faster settlement, and a more customised trading experience compared to public exchanges.
How OTC Desks Operate
The process typically begins with a client inquiry—often a fund, crypto-native business, or corporate treasury manager—requesting a quote for a large trade. The desk provides a firm bid or ask price, locked in for a brief window to protect the client from market fluctuations. Once the quote is accepted, the desk executes the trade—either from internal inventory (in the case of a principal desk) or by matching with a third-party counterparty (for agency desks). Settlement follows, via fiat rails or crypto wallets, using institutional-grade custody. Post-trade, the desk issues audit-ready reports to support compliance, accounting, and tax requirements.
This white-glove service stands in contrast to the self-serve retail experience. OTC trades are negotiated directly, often through chat or voice, and backed by stringent KYC, AML, and counterparty vetting processes. As such, they are ideal for firms looking to move large amounts of capital without triggering market volatility or exposing strategy.
Why OTC Desks Drive B2B Exchange Revenue
OTC desks are more than just a convenience—they are strategic infrastructure for serving high-value clients and unlocking new revenue models.
1. Deep Liquidity for Enterprise Users
OTC desks aggregate liquidity from internal sources, market makers, and other OTC partners, enabling them to fill multi-million-dollar orders efficiently. This attracts institutional clients who require execution size without price impact—whether they’re managing treasury positions, seeding liquidity pools, or rebalancing portfolios.
2. Premium Pricing via Spreads and Fees
Unlike thin-margin spot trading, OTC deals are bespoke. Desks earn from wider bid/ask spreads, negotiated commissions, and additional service fees (e.g., FX conversions, cross-border settlements). Because clients value privacy and certainty, they’re often willing to pay more for execution that avoids market disruption.
3. Strategic Client Relationships
Each OTC trade is a relationship touchpoint with CFOs, fund managers, and institutional decision-makers. These interactions open doors to recurring business, referrals, and upsell opportunities like custody, yield products, or structured finance solutions. In essence, OTC desks double as enterprise sales channels for the exchange.
4. Price and Market Stability
By routing large trades off-book, OTC desks prevent sudden market swings, front-running, and visible order book imbalances. This stabilizes the exchange ecosystem, supporting a smoother experience for all users and reinforcing trust in the platform’s pricing integrity.
5. Expanding the Institutional Product Suite
An integrated OTC desk complements the broader exchange offering. Institutions get access to both public and private liquidity, and the ability to move between the two depending on their objectives. This 360-degree liquidity model is difficult for competitors to replicate and strengthens overall client retention.
Use Cases for Enterprise Clients
OTC desks unlock execution capabilities for a wide range of B2B scenarios. Corporate treasuries can convert millions into stablecoins without alerting markets. Hedge funds and market makers can source inventory for arbitrage or DeFi strategies. NFT platforms can facilitate high-value art sales off-exchange. And fintech companies handling cross-border remittances can access efficient fiat-to-crypto conversions.
In each of these cases, OTC desks provide execution confidence and price stability—while the exchange benefits from high-margin, repeat business.
Why Exchanges Should Bring OTC In-House
Today, most crypto exchanges and over-the-counter (OTC) trading desks operate as separate entities. OTC desks serve high-volume traders—such as institutions, market makers, and HNWIs—who prefer direct, discreet execution outside of volatile public order books. These transactions typically range from hundreds of thousands to millions of dollars in a single block.
But here’s the opportunity: exchanges are already where the clients are. By internalizing OTC services, exchanges can consolidate client relationships, capture new revenue streams, and improve operational efficiency.
Here’s why it makes strategic sense:
1. Capture High-Margin Institutional Flow
OTC trades typically command higher spreads than retail spot trades—especially for exotic pairs, illiquid tokens, or large-size orders. By running their own OTC desk, exchanges can:
- Earn spreads directly instead of referring volume elsewhere
- Offer custom pricing tiers and increase total revenue per user
- Build tailored services (e.g., settlement flexibility, custody, VIP onboarding) that improve retention
2. Increase Platform Stickiness
When an exchange provides both the venue and the desk, clients don’t need to switch platforms or rely on third-party intermediaries. They can execute large trades and then manage their assets—all under one roof. This integrated experience builds:
- Client trust
- Brand loyalty
- Greater wallet share from institutional partners
3. Gain Internal Liquidity Intelligence
Running an OTC desk gives exchanges insight into off-book market flows. This real-time visibility improves:
- Liquidity planning across the exchange
- Risk management for volatile markets
- Pricing accuracy for thinly traded assets
This data advantage is crucial for supporting new listings or launching future products like structured derivatives, prime brokerage, or RFQ engines.
4. Support More Complex Client Needs
OTC clients often want more than just spot execution—they need settlement netting, cross-chain transfers, or delayed settlement. By handling OTC in-house, exchanges can build custom infrastructure that supports:
- Multi-chain trade settlements
- Post-trade clearing
- Cross-exchange routing
These are value-added services that go beyond traditional trading fees.
Using OTC Desks in B2B Exchange Revenue
The future of exchange revenue lies upstream—from servicing millions of retail users to serving thousands of high-value institutions. OTC desks are a critical part of this shift. They provide discretion, liquidity, and service levels that institutions demand—while generating deeper relationships, premium margins, and differentiated positioning for the exchange.
At ChainUp, we provide institutional-grade infrastructure that scales with your exchange. From quoting engines to compliance, custody, and fiat integration—our platform helps you unlock the full revenue potential of institutional trading. Explore our solutions today.
