Crypto OTC Volumes on Wintermute Soared 400% in 2023
Crypto trading volume reached a multi-year low in 2023, with exchanges experiencing significant declines. However, over-the-counter (OTC) volume increased by 400% throughout the year, according to a report from market maker and liquidity provider Wintermute. The company reported a decrease in OTC trading volume in the first half of 2023, but the number of individual trades remained stable. In the second half of the year, unique trades increased sixfold to 29 million, and weekly OTC volume reached $2 billion. A lack of liquidity has been a consistent issue for exchanges in 2023, prompting many large institutional traders to switch to OTC desks. Despite Bitcoin rallying by over 150% during the year, the market continued to suffer from a liquidity gap. Binance, the world's largest crypto exchange, saw its order book liquidity drop by 25% in November, exacerbated by a $4 billion settlement with U.S. authorities and the resignation of its CEO Changpeng 'CZ' Zhao.
