How Do OTC Desks Utilize Request for Quote (RFQ) Systems?
RFQ systems allow institutional clients to privately solicit quotes from multiple OTC desks simultaneously for a specific block trade size. The desks compete by providing their best price (bid and ask) in a private, pre-trade environment.
This process ensures the client receives competitive pricing and prevents the trade inquiry from leaking to the broader market, which is crucial for large orders.
Glossar
Request for Quote
Inquiry ⎊ A Request for Quote (RFQ) within cryptocurrency derivatives represents a formalized solicitation from a potential client to multiple counterparties for pricing and terms related to a specific transaction.
Quote
Basis ⎊ The expression of a desired transaction price for an asset or derivative contract at a specific point in time.
OTC Desks
Execution ⎊ These specialized desks within financial institutions or large crypto firms facilitate the execution of large-volume, non-standardized derivatives trades directly with clients.