Negotiated Markets describe trading environments where the price and specific terms of a transaction for crypto assets or derivatives are established through direct discussions and mutual agreement between two or more parties. This mechanism facilitates customized and private transactions outside of public order books.
Mechanism
Participants typically engage through Request for Quote (RFQ) systems or direct bilateral communication channels to solicit tailored prices for desired quantities. Counterparties then provide specific quotes, leading to a direct transaction if the terms are acceptable. This process allows for bespoke deal structures that may not be feasible on standard exchanges, especially for large or illiquid assets.
Methodology
This approach prioritizes privacy, flexibility, and direct liquidity sourcing for institutional investors. It enables the execution of significant block trades without immediate market signaling, potentially securing better pricing or more complex structures than those available on lit markets, while maintaining control over the specific execution details.
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