Brazil is home to half of South America’s population and wealth, and right now, the country’s largest investment broker firm may be primed to launch an over-the-counter (OTC) bitcoin exchange.
XP Investimentos[1] has not made any official announcements on the matter, but according to reports[2] in Portal do Bitcoin on Tuesday, April 17, 2018, the investment firm is behind a new company called XDEX with around $7.5 million in capital. Portal do Bitcoin did some research and connected the two the companies.
As the story goes, XP previously registered a new company called XP Coin Intermediacao. In November 2017, at the time cryptocurrency markets were on fire, XP Coin changed its name to XDEX and got a $1.5 million influx of cash. Later, in February 2018, it received another $6 million.
OTC Trading
While not much is known about the new cryptocurrency exchange, Portal do Bitcoin claims that a source unwilling to expose his or her identity said that XDEX was planning to do an OTC market, meaning it would focus on large fiat and Bitcoin transactions — in other words, heavyweight investors.
OTC simply means that the trade does not show up in the order books, like it does on exchanges such as GDAX or Kraken. Instead, in an OTC scenario, XP would act as a middleman connecting someone who wants to sell a large stash of bitcoin with a buyer who has a large sum of cash. The advantage of selling OTC is that traders can lock in their gains with one big trade; whereas if they were to sell through an exchange, the price could start slipping as the order was filled. For its part, XP would take a cut in brokering the deal.
