“On-Exchange Execution” in crypto refers to the process of buying or selling digital assets directly through a centralized or decentralized exchange (CEX or DEX), where orders are matched and settled via the exchange’s dedicated infrastructure. This method contrasts with bilateral over-the-counter (OTC) transactions.
Mechanism
Orders are submitted to the exchange’s order book, where they are matched against opposing bids or offers based on price-time priority or other defined rules. The exchange acts as an intermediary, managing liquidity, facilitating price discovery, and ensuring the final settlement of executed trades on its platform, providing a structured trading environment.
Methodology
The strategic advantages of on-exchange execution include price transparency, access to diverse liquidity pools, and standardized trading rules. While CEXs offer speed and fiat gateways, DEXs prioritize censorship resistance and direct smart contract interaction, each presenting distinct architectural considerations for institutional crypto traders balancing efficiency, cost, and control.
RFQ protocols offer superior discretion and reduced information leakage for large crypto options, while on-exchange execution provides continuous, transparent liquidity.
Regulatory frameworks mandate on-exchange execution for options, shaping dark venues into crossing networks and RFQs into structured negotiation protocols.
We use cookies to personalize content and marketing, and to analyze our traffic. This helps us maintain the quality of our free resources. manage your preferences below.
Detailed Cookie Preferences
This helps support our free resources through personalized marketing efforts and promotions.
Analytics cookies help us understand how visitors interact with our website, improving user experience and website performance.
Personalization cookies enable us to customize the content and features of our site based on your interactions, offering a more tailored experience.
