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>You can trade crypto assets without ever using Coinbase or any other centralized exchange. I'm genuinely curious how one could do this at scale. I'm not talk

>You can trade crypto assets without ever using Coinbase or any other centralized exchange. I'm genuinely curious how one could do this at scale. I'm not talking about buying $1,000 of BTC on a P2P marketplace so you can then use it to buy drugs somewhere. I'm talking about someone wanting to buy $1 Million worth of BTC, then exchange half of it for ETH, then convert all of the BTC and ETH for fiat. How would one do this quickly and cost effectively without the use of any sort of exchange?

Yizahi 4y ago
Easy, you take your tokens on a flash drive and fly to the Bahamas, where you meet in a back alley with Giancarlo and Paolo, who give you the keys from a dump truck full of unmarked twenties. And there reverse is possible of course - you get the dollars to Giancarlo, end he gives you his IGUs (it's like IOUs, but without "O", because he officially doesn't "owe" you anything, as per terms of service). This is called "institutional investors". It is fun to stay rich :)
rglullis 4y ago
Why would you do that (the fiat)? Remove the fiat part from the equation, and the way to answer is easy, you can trade crypto-tokens in the many decentralized exchanges. And if you just want to hold volatile currency, you can trade the BTC or ETH for some stable token (like DAI, synthetix USD if you don't want to rely on fintech-backed tokens. If you are fine with using tokens backed by more credible institutions, you can hold USDC or Gemini USD)
- mensetmanusman 4y ago
  Because you still have to buy food with Fiat
  - rglullis 4y ago
    OP was not asking how to buy $1M worth of food. OP was asking how to trade large amounts at scale. (It's amazing how inconsistent the skeptics are, when they are only trying to score some cheap points against what they don't like)
    - JumpCrisscross 4y ago
      > amazing how inconsistent the skeptics are Most people looking to trade large quantities of crypto have most of their wealth in other assets and expect to be able to convert between them, with the dollar as the default go-between. This is true of practically every traded asset, including FX. It’s not true of e.g. MGM tokens. But that disparity highlights the difference between crypto and other traded assets.
      - rglullis 4y ago
        That is anyway still beyond what was asked. The question was "how can anyone trade large amounts of crypto without a centralized exchange?" Also, the fact that people currently use USD as "the default go-between" does not mean that people have to keep using it. Crypto OTC desks already exist.
        JumpCrisscross 4y ago
        > question was "how can anyone trade large amounts of crypto without a centralized exchange?" OTC desks are the correct answer, not “why would you want to” use a dollar. Yes, in a hypothetical world people wouldn’t use dollars as a go between, but instead use [insert theme of the decade]. In reality, we do and will for the foreseeable future. Also, a crypto OTC desk that doesn’t ask for KYC is by almost every country’s law laundering money. So it doesn’t sidestep the core issue of this post.
        rglullis 4y ago
        I am not even challenging the need for KYC, but I would challenge the expectation that USD will remain king for the foreseeable future. If the idea is, like you said, just about being able to convert between different asset classes, we could have OTC desks that would be taking crypto and (after following proper KYC/AML regulations) giving you any of stock/bonds/real estate titles/commodities/etc, and vice-versa, without any need of USD as intermediary.
- Ntrails 4y ago
  My model for stable coins is that they're either backed by risk-free assets (cash/short term gov) which are externally audited, or they're not stable. I have no idea which of the above meet that criteria. Irrespective, if I want to lock in trading gains I want FIAT. Because that's what I use to buy stuff. Sticking it in some proxy to FIAT is taking counterparty/credit/etc risk for no return.
  - rglullis 4y ago
    > Because that's what I use to buy stuff. For now, for lack of competitive alternatives. I'm not even saying that you will be buying everything with crypto in the coming years. But I do see a future where it can be more secure and more practical to buy some things with crypto: digital goods, concert tickets, service subscriptions... put all of these things together and suddenly we will find ourselves with a crypto wallet making transactions worth a few hundred dollars every month.
    - ALittleLight 4y ago
      I'm always amazed at how many years into the future crypto enthusiasts are willing to wait for the basic use case of their product to be practical. "Sure, you can't use this currency for day to day transactions, and it's incredibly volatile and risky to hold significant amounts of it, but one day, by magic one assumes, it might be useful!"
      - rglullis 4y ago
        Don't be discouraged if what you produce initially is something other people dismiss as a toy. In fact, that's a good sign. That's probably why everyone else has been overlooking the idea. The first microcomputers were dismissed as toys. And the first planes, and the first cars. At this point, when someone comes to us with something that users like but that we could envision forum trolls dismissing as a toy, it makes us especially likely to invest. (http://www.paulgraham.com/organic.html http://www.paulgraham.com/organic.html) > you can't use this currency for day to day transactions Not with this attitude, you can't. ;) What currency is "this"? BTC, ETH, Doge, USDC, DAI? > incredibly volatile How volatile is USDC, DAI, GUSD? > risky to hold significant amounts of it It's also risky to walk around with significant amounts of cash in the wallet. It doesn't stop people from wanting to carry some money around. And more importantly, the alternative of "going cashless" is a whole other set of systemic risks. > it might be useful! The use cases exist already. Micropayments and streaming transfers (as an alternative for subscriptions) using stable currencies are already possible. If you don't care about it, it's a different story.
junofan 4y ago
Look up “OTC desk.”
- kasey_junk 4y ago
  There are otc desks that will do that small a transaction? Where?
lebed2045 4y ago
I’m myself traded over 1M regularly the last year. We even developed a decentralized exchange for Chinese customer (although with nasdaq traded parent) that made over billion dollars in stabelcoins in just about 12 weeks. DEXs usage is big. Perhaps you mixed two different thighs: fiat on ramp, and exchange ? If so, as far as I concerned even at the beginning of defi summer 2020 bestchange ramps in Moscow city alone had around $30m a day against fiat. I can’t verify this numbers but given the level of crypto adoption in eastern Europe these numbers don’t seem very off really.
- tsimionescu 4y ago
  By your reference to stable coins, it's unclear if any of the values you talk about are real dollars (or euros or rubles or any other fiat money), or just the dollar equivalent in crypto.
TimJRobinson 4y ago
Uniswap (a completely decentralized on-chain exchange) process over $1 Billion in volume per day, that $1M is a tiny drop in the bucket. You can load that BTC on Ethereum as WBTC, swap for ETH, then swap for DAI/USDC and withdraw via about 50 different offramps. None of these trades will give even 0.01% slippage and total cost will be about $50 on Ethereum, or 10c on Polygon.

Yizahi 4y ago

Easy, you take your tokens on a flash drive and fly to the Bahamas, where you meet in a back alley with Giancarlo and Paolo, who give you the keys from a dump truck full of unmarked twenties. And there reverse is possible of course - you get the dollars to Giancarlo, end he gives you his IGUs (it's like IOUs, but without "O", because he officially doesn't "owe" you anything, as per terms of service). This is called "institutional investors". It is fun to stay rich :)

rglullis 4y ago

Why would you do that (the fiat)? Remove the fiat part from the equation, and the way to answer is easy, you can trade crypto-tokens in the many decentralized exchanges. And if you just want to hold volatile currency, you can trade the BTC or ETH for some stable token (like DAI, synthetix USD if you don't want to rely on fintech-backed tokens. If you are fine with using tokens backed by more credible institutions, you can hold USDC or Gemini USD)

mensetmanusman 4y ago
Because you still have to buy food with Fiat
- rglullis 4y ago
  OP was not asking how to buy $1M worth of food. OP was asking how to trade large amounts at scale. (It's amazing how inconsistent the skeptics are, when they are only trying to score some cheap points against what they don't like)
  - JumpCrisscross 4y ago
    > amazing how inconsistent the skeptics are Most people looking to trade large quantities of crypto have most of their wealth in other assets and expect to be able to convert between them, with the dollar as the default go-between. This is true of practically every traded asset, including FX. It’s not true of e.g. MGM tokens. But that disparity highlights the difference between crypto and other traded assets.
    - rglullis 4y ago
      That is anyway still beyond what was asked. The question was "how can anyone trade large amounts of crypto without a centralized exchange?" Also, the fact that people currently use USD as "the default go-between" does not mean that people have to keep using it. Crypto OTC desks already exist.
      - JumpCrisscross 4y ago
        > question was "how can anyone trade large amounts of crypto without a centralized exchange?" OTC desks are the correct answer, not “why would you want to” use a dollar. Yes, in a hypothetical world people wouldn’t use dollars as a go between, but instead use [insert theme of the decade]. In reality, we do and will for the foreseeable future. Also, a crypto OTC desk that doesn’t ask for KYC is by almost every country’s law laundering money. So it doesn’t sidestep the core issue of this post.
        rglullis 4y ago
        I am not even challenging the need for KYC, but I would challenge the expectation that USD will remain king for the foreseeable future. If the idea is, like you said, just about being able to convert between different asset classes, we could have OTC desks that would be taking crypto and (after following proper KYC/AML regulations) giving you any of stock/bonds/real estate titles/commodities/etc, and vice-versa, without any need of USD as intermediary.
Ntrails 4y ago
My model for stable coins is that they're either backed by risk-free assets (cash/short term gov) which are externally audited, or they're not stable. I have no idea which of the above meet that criteria. Irrespective, if I want to lock in trading gains I want FIAT. Because that's what I use to buy stuff. Sticking it in some proxy to FIAT is taking counterparty/credit/etc risk for no return.
- rglullis 4y ago
  > Because that's what I use to buy stuff. For now, for lack of competitive alternatives. I'm not even saying that you will be buying everything with crypto in the coming years. But I do see a future where it can be more secure and more practical to buy some things with crypto: digital goods, concert tickets, service subscriptions... put all of these things together and suddenly we will find ourselves with a crypto wallet making transactions worth a few hundred dollars every month.
  - ALittleLight 4y ago
    I'm always amazed at how many years into the future crypto enthusiasts are willing to wait for the basic use case of their product to be practical. "Sure, you can't use this currency for day to day transactions, and it's incredibly volatile and risky to hold significant amounts of it, but one day, by magic one assumes, it might be useful!"
    - rglullis 4y ago
      Don't be discouraged if what you produce initially is something other people dismiss as a toy. In fact, that's a good sign. That's probably why everyone else has been overlooking the idea. The first microcomputers were dismissed as toys. And the first planes, and the first cars. At this point, when someone comes to us with something that users like but that we could envision forum trolls dismissing as a toy, it makes us especially likely to invest. (http://www.paulgraham.com/organic.html http://www.paulgraham.com/organic.html) > you can't use this currency for day to day transactions Not with this attitude, you can't. ;) What currency is "this"? BTC, ETH, Doge, USDC, DAI? > incredibly volatile How volatile is USDC, DAI, GUSD? > risky to hold significant amounts of it It's also risky to walk around with significant amounts of cash in the wallet. It doesn't stop people from wanting to carry some money around. And more importantly, the alternative of "going cashless" is a whole other set of systemic risks. > it might be useful! The use cases exist already. Micropayments and streaming transfers (as an alternative for subscriptions) using stable currencies are already possible. If you don't care about it, it's a different story.

junofan 4y ago

Look up “OTC desk.”

kasey_junk 4y ago
There are otc desks that will do that small a transaction? Where?

lebed2045 4y ago

I’m myself traded over 1M regularly the last year. We even developed a decentralized exchange for Chinese customer (although with nasdaq traded parent) that made over billion dollars in stabelcoins in just about 12 weeks. DEXs usage is big. Perhaps you mixed two different thighs: fiat on ramp, and exchange ? If so, as far as I concerned even at the beginning of defi summer 2020 bestchange ramps in Moscow city alone had around $30m a day against fiat. I can’t verify this numbers but given the level of crypto adoption in eastern Europe these numbers don’t seem very off really.

tsimionescu 4y ago
By your reference to stable coins, it's unclear if any of the values you talk about are real dollars (or euros or rubles or any other fiat money), or just the dollar equivalent in crypto.

TimJRobinson 4y ago

Uniswap (a completely decentralized on-chain exchange) process over $1 Billion in volume per day, that $1M is a tiny drop in the bucket. You can load that BTC on Ethereum as WBTC, swap for ETH, then swap for DAI/USDC and withdraw via about 50 different offramps. None of these trades will give even 0.01% slippage and total cost will be about $50 on Ethereum, or 10c on Polygon.