Over the Counter (OTC) Bitcoin Trading Tips Every Buyer Should Take Into Consideration First
Bitcoin (BTC) trading is becoming more and more popular as the years go by, and its availability and diversity of trading options are among the biggest reasons for that. The trading options are many, and they include crypto exchanges, OTC trading, P2P trading, and more.
All of these options are worth exploring, and once you get to know them, you can choose the one that works best for you. However, if you choose to go with OTC trading, there are a few things that you should be aware of. Think of them as useful tips, but tips that you should definitely keep in mind in order to avoid experiencing losses. To help you out, we have prepared several useful tips that will help you come out on top, and avoid losing your coins to a scam or entering a bad deal.
1. Avoid Private OTC Chat Rooms
Those looking to buy Bitcoin aim to do so at the lowest price possible. Then, your goal would be to sell it on the highest price, or HODL the coins until a massive surge takes BTC to new heights. To achieve this, many would go to private OTC BTC trading groups, in hopes of getting a deal at a competitive price.
But, what you need to keep in mind that these are often groups ran by scammers, who will try to trick you out of your money. Not all private groups are like that, naturally. But, many of them are, and while you might expect that they would be short-lived, the fact is that they remain active for a long time. Users who get tricked know that they did not exactly choose the most legal of options, so they tend to keep quiet and suffer the consequences. Those consequences often include losing massive amounts of money, so keep that in mind, as you will likely never get it back.
2. Individual Trades Could Be Scams as Well
Bitcoin is growing and spreading around the world at a rapid pace. The number of people owning BTC is higher than ever before. With that in mind, it would be reasonable to assume that the OTC market would grow and expand massively. However, traders that deal with huge amounts of coins need to get a transmitter license, or they will get in trouble with the law.
However, a lot of them don't, and instead, they tend to try and scam traders who are after a good deal. The scam results in the scammer disappearing with your money, and you are once again left disappointed. It is best to find proper firms, or at least those who have licenses to prove their legitimacy.
3. There is No Shortage of Proper OTC Desks
As mentioned, the popularity and rapid expansion of the crypto space has made OTC trading more than profitable. As a result, registered, legitimate companies wishing to trade are now everywhere, and you will definitely be able to find them if you look.
Yes, working with them is a bit more complex, and it will require some fees, but at least you will not be scammed out of your money, with nothing but a valuable lesson gained in return. More firms are entering the space all the time, and there is really no reason to avoid them and go for deals too good to be true. And, while we are at it…
4. Too Good to Be True
The crypto space may still be unregulated, but regardless, it still follows some basic rules. And that is that no one is going to give you a great deal which is completely legit. If someone tries, they are attempting to scam you. It is as simple as that. Investors and traders always run into these type of scams because they are attracted by the possibility of easy money.
It is easy to get cryptocurrencies, and you can even make a massive profit if you play your cards right. But, that requires a good strategy, a lot of patience, and a bit of luck. No great deal is going to pop up when the rest of the market suffers, so don't fall for it.
5. Only Invest What you can Afford to Lose
Finally, there is a rule that everyone should follow, no matter what you are investing in. It may be crypto, or stock, or something else, but one rule never changes — only invest that which you can afford to lose. The simple and best strategy is to assume that every trade or investment you make is going to fail. If you are optimistic, make it anyway. If you are right, you will be pleasantly surprised.
If you are not, you will not remain completely broke and with nothing in return. People were known to lose everything by making a wrong investment choice, convinced that it was a good decision at the time. Make this your base rule, and never invest more than you can afford to lose, no matter how high the chance of making a successful investment might be. Remember that investing is basically glorified betting, and things can go either way.