The secondary OTC (over-the-counter) market – where locked or privately held Web3 tokens change hands away from public exchanges – has rapidly grown in importance.
Presto Research finds that this market “is gaining prominence” as a liquidity venue, helping to “reduce sell-pressure” and contribute to a more stable crypto ecosystem. Industry data confirm this growth:
Finery Markets reports institutional OTC volumes jumped 106% in 2024 alone (driven by factors like U.S. ETF demand), while CoinTelegraph notes there was never a month in 2024 when OTC volumes fell below the previous year’s level.
Even in 2023, Chainalysis data show OTC trade volume climbed about 18% despite a down market. In short, major players are increasingly “warming to the more private” trading method. For Web3 founders, understanding this trend is key to any liquidity strategy: OTC deals are not just fundraising events but tools that must be carefully integrated with marketing, PR and community-building.
Volume Surge:
According to Finery Markets, institutional OTC trading doubled in 2024. Every quarter of 2024 saw year-on-year growth – Q4 alone saw an 80–191% rise in Bitcoin, Ethereum and stablecoin OTC trades. Remarkably, Finery notes no month in 2024 saw volumes dip below 2023’s levels.
Altcoins on the Rise:
The OTC market is broadening beyond Bitcoin/Ether. Finery reports altcoins grew from ~13% of OTC volume in 2023 to 29% in 2024. Litecoin, Solana, XRP and others saw triple-digit OTC growth, reflecting growing interest in private markets for non-FTT coins.
Steady Uptrend:
Even before 2024’s boom, OTC volume was trending up. Chainalysis found OTC trades grew ~18% in 2023, particularly concentrated in locked-token transfers and private HNW deals. Overall, data from Presto and Finery suggest a clear expansion of OTC trading: more deals, more volume, and increasing market share for OTC in crypto’s ecosystem.
These trends confirm that deal flow in secondary markets is robust. As ChronosDAO has seen firsthand, projects and funds are actively matching over-the-counter supply and demand. In 2024 ChronosDAO alone helped raise $16.2M for partners via OTC and TSF deals and forged 8+ new VC partnerships to sustain post-TGE deal flow. This underscores that OTC has become a strategic funding channel, not a niche backroom.
The OTC market attracts distinct types of participants with clear motivations:
Sellers (Teams, VCs, Foundations): On the sell side, many projects (and their investors) are choosing to liquidate portions of locked-token holdings. Presto notes that top-tier projects often see 50–70% discounts in OTC relative to on-exchange prices. Bitget’s analysis echoes this: teams with multimillion-dollar FDVs (often small dev teams) find selling at 50–70% still very profitable. In practice, many VC funds have seen valuations jump rapidly (sometimes doing multiple rounds in parallel), so even at 50% off they’re locking in gains. Foundations likewise often sell unlocked tokens at discounts with new lockups – raising operating funds while helping stabilize market supply. In short, sellers are typically insiders securing liquidity (and profits) ahead of unlock events or market pressure.
Buyers (Hodlers, Hedgers): Buyers fall largely into two camps. One group is long-term believers or “hodlers” who willingly buy discounted tokens to hold for years. For example, Bitget describes hodlers as investors “bullish on long-term potential,” taking up to 50% discounts to accumulate more tokens at a lower cost. The other group is sophisticated traders or “hedgers.” These buyers use financial tools (perps, futures) to capture guaranteed returns: they buy tokens cheaply OTC and short them on exchanges. Because they lock in the price gap (and often positive funding rates), these arbitrageurs profit from the split between OTC and spot prices.
This dichotomy shapes discounts: deep sales (50–70% off) are needed to attract hedgers who demand high return, while hodlers are drawn by long-term upside. As Presto summarizes, OTC sellers often seek “early profits or manage selling pressure,” whereas buyers either “believe in long-term potential” or seek arbitrage. Understanding these dynamics helps founders negotiate fair terms – ChronosDAO emphasizes structuring deals (lockups, vesting, etc.) to protect token health and align all parties.
Web3 tokens often come with lengthy vesting and high diluted valuation (FDV), creating liquidity challenges. When large tranches unlock, public market supply spikes and prices can tumble. OTC channels emerge as a liquidity strategy to mitigate this. By selling locked tokens privately, teams and investors can secure funds at a negotiated discount instead of dumping on exchanges. Industry sources quantify these discounts: many top-20 tokens trade at roughly a 50% discount in OTC (with 1-year locks), and lesser-known projects see discounts up to 70%. These figures align with on-chain data: Odaily notes early investors sometimes paid as little as 30% of on-exchange prices via OTC in 2022.
Such steep discounts reflect current market realities. As Presto explains, a glut of new projects has far outpaced liquidity and genuine user growth. With high FDVs and regular unlocks, prices naturally slip. Savvy founders anticipate this by planning OTC raises well before tokens hit exchanges. They understand that selling at e.g. 50–60% off today might be preferable to facing a 70–80% freefall later. ChronosDAO often advises clients on this balance: using OTC token sales (with proper vesting schedules) to “remove motivated sellers from the cap table” and raise capital while tempering market impact.
Secondary OTC markets serve multiple strategic functions for projects:
Fundraising & Treasury Management: Protocol treasuries and teams can structure OTC raises to build runway. For example, ChronosDAO has helped several protocols raise cash via OTC deals where investors accept long vesting, allowing teams to stock cash reserves without instant market dumps. This diversifies funding (beyond token sales and VC funding) and de-risks operations.
Managing Supply and Price Pressure: OTC deals can offload large token blocks into private hands instead of open markets. Presto notes that a well-structured secondary sale “removes motivated sellers from your cap table, preventing them from selling on the orderbook”. In practice, this introduces new holders at higher cost bases and extends token supply curves (new vesting). All of this helps reduce sell-pressure on public listings.
Raising Token Cost Basis: By bringing in new investors at above-spot cost, OTC deals increase the average cost basis of private holders. In other words, buyers paying a premium (via lockups) are incentivized to hold longer, which can stabilize secondary prices.
Ensuring Transparency and Compliance: Conducting planned OTC trades (often through known brokers) adds oversight to token distribution. As Presto’s STIX founder notes, visibility prevents “under-the-table deals” and builds trust with the community. This matches ChronosDAO’s ethos: “token health comes first”, with strict vetting of investors and deal terms.
In sum, OTC is treated not as a shortcut but as a component of a broader liquidity strategy. When used wisely, it allows projects to de-risk large unlocks while aligning with long-term growth plans. As one industry analyst puts it, today’s OTC market is essential for “managing liquidity and securing profits” in a market of high FDV and thin float.
At ChronosDAO, we view secondary OTC deals as one part of an integrated growth playbook. We emphasize long-term partnerships: as our team states, “we don’t treat OTC deals as quick wins. We treat them as long-term partnerships between projects and investors who want more than just short-term gains”. In practice, this means rigorous diligence (walking away from misaligned capital) and deal structuring (lockups, vesting, flow controls) that protect token value.
ChronosDAO has executed OTC deals for leading projects including Omi Token, Metatrace, and Carrieverse. While some details remain confidential under NDA, these deals exemplify our model of combining treasury strategy with community activation.
Carrieverse Deal Example: In our OTC campaign with Carrieverse – Southeast Asia’s top-10 Google Play GameFi project backed by Polygon – we executed a private deal alongside a monthly growth push. Despite running an OTC round, our ongoing parallel liquidity campaigns led to a 27% increase in 24h trading volume — a clear testament to how well-executed liquidity support can drive market engagement. ChronosDAO structured the OTC alongside KOL campaigns, treasury optimization, and user onboarding initiatives.
But ChronosDAO also leverages every deal for organic token visibility and community-driven growth. We combine fundraising with Web3 PR and KOL amplification to convert investor interest into genuine project engagement. For example, in 2024, we activated 89 influencers across various tiers and geographies, running campaigns on X, YouTube, Telegram, TikTok, and more — generating approximately $3M in trading volume and onboarding a record 49,028 new wallets in single campaign pushes. We focus on localizing messages: for Asia, we deployed networks of 2,000+ regional KOLs and niche media; in Europe and LATAM, tailored PR hubs and community triggers. This community-driven strategy ensures that OTC raises are accompanied by real user growth, not just token flips.
Key facets of ChronosDAO’s model include:
Full-Cycle Marketing & PR: As a “full-cycle growth and investment partner,” we blend tokenomics, content, and PR. Our services span everything from token supply design to strategic PR to post-launch fundraising. By coupling OTC funding with organic marketing, we raise token visibility – for example, our campaigns created real press coverage and social buzz around client tokens.
KOL Amplification: Leveraging a KOL network of 2,000+ influencers, ChronosDAO designs outreach across multiple tiers. In 2024 alone, campaigns under our guidance resulted in tens of thousands of engaged users, proving that KOL amplification translates directly into on-chain activity.
Strategic Regional Outreach: Geography matters. We’ve built local networks of key opinion leaders, media partners and niche communities in markets like Japan, Korea, Southeast Asia, CIS and MENA. When we execute an OTC-backed fundraising, we often launch concurrent PR/KOL campaigns in target regions – effectively turning a capital raise into a launchpad for market expansion.
Partnership-Driven Deals: ChronosDAO emphasizes stable, long-term relationships. We structure trades with healthy lockups so that early investors (and our own community) aren’t short-changed. We then stay involved post-deal – running trading competitions, KOL drives, or “real world” events to support token health. In effect, each secondary OTC acquisition we facilitate comes with a tailored growth package.
These practices ensure that OTC funding builds sustainable momentum. ChronosDAO’s 2024 results speak volumes: our clients collectively raised $16.2M through OTC and TSF deals. Projects choose ChronosDAO because we deliver “measurable outcomes, not just impressions” – scaling tokens with coordinated liquidity strategy, PR and community activation.
The secondary OTC market is no longer a murky sideshow – it’s a core component of modern Web3 fundraising and liquidity management. Today’s data and deals show a market that is growing rapidly and rewarding projects that plan intelligently. Common discount ranges (30–70% off public price) reflect real-world value gaps, and informed teams can leverage this by using OTC raises to bolster their treasuries and tokenomics. Similarly, the dramatic volume increases signal that more liquidity providers and traders are participating than ever before.
For founders, the takeaway is clear: embrace OTC as part of a holistic liquidity strategy, but do so thoughtfully. Align with partners who bring not just capital, but strategic marketing muscle and community networks. ChronosDAO’s approach – blending investor outreach, local PR/KOL campaigns, and patient growth mindset – is one proven path. In our view, the best OTC deals don’t end at a check; they initiate a new phase of collaboration. As ChronosDAO puts it, “OTC is never the end goal…done right, it gives the project room to breathe and runway to grow.”
Sources: Authoritative analyses (Presto Research, Odaily, Chainalysis, Finery/CoinTelegraph) and ChronosDAO data. These citations provide current figures and strategic insights (2023–2025) on secondary OTC markets, investor profiles, deal trends, and ChronosDAO’s support model.
