OTC Desks Mitigate Binance Liquidation, Acting as Market Shock Absorbers
Over-the-counter (OTC) desks played a crucial role in stabilizing the crypto market during last week’s sharp downturn, preventing localized turmoil from spreading systemically, according to Finery Markets, a top crypto ECN and trading platform.
On Friday, Bitcoin (BTC) fell from roughly $122,000 to $103,000, while altcoins and stablecoins—including Ethena’s USDe, Wrapped Beacon Ether (wBETH), and Binance Staked SOL (BNSOL)—also saw sharp volatility. USDe briefly dropped to $0.65 on Binance due to platform-specific inefficiencies but remained steady on venues like Curve, Fluid, and Bybit.
“The crisis highlighted the value of OTC private rooms, which act as a firewall against systemic contagion,” Finery Markets said.
Unlike centralized exchanges with visible order books, OTC desks provide private liquidity pools, allowing large trades without triggering panic-driven swings. During the October 10–12 liquidation, BTC/USDT and ETH/USDT volumes in Finery’s OTC rooms surged 107% week-over-week, surpassing 48% growth on centralized platforms. Narrower bid-ask spreads also reflected improved liquidity and smoother execution.
Finery Markets’ report underscores the critical role of OTC infrastructure in containing volatility and maintaining market stability during extreme stress.
