1 Minute Guide to OTC and Spot Trading – Beginner’s Tutorial

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Cryptocurrency trading can seem overwhelming for newcomers, but understanding the basics of OTC trading and spot trading is a solid first step. This guide breaks down everything you need to know in simple terms—no prior experience required. Whether you're looking to convert fiat currency into digital assets or trade one cryptocurrency for another, this tutorial covers the essentials with clarity and precision.

What Is OTC Trading?

Due to regulatory restrictions in certain regions, centralized exchanges do not allow direct RMB-to-crypto transactions. Instead, they offer Over-The-Counter (OTC) trading, a peer-to-peer marketplace where users buy and sell cryptocurrencies using fiat money—like Chinese yuan—without direct exchange involvement.

Think of OTC trading as similar to a C2C platform like Taobao: buyers and sellers connect directly, while the exchange acts as a trusted intermediary to ensure secure transactions.

Most platforms support OTC trading primarily for major cryptocurrencies such as USDT, BTC, and ETH. Among these, USDT (Tether) stands out as the best choice for beginners because it's a stablecoin pegged 1:1 to the U.S. dollar. This means its value remains relatively stable compared to volatile assets like Bitcoin or Ethereum, making it ideal for entering and exiting crypto positions safely.

👉 Discover how easy it is to start your first secure OTC transaction today.

How to Get Started with OTC Trading

The process of buying crypto via OTC is straightforward and typically follows these steps:

Step 1: Register an Account

Use your phone number or email address to sign up on a reputable cryptocurrency exchange. Make sure the platform supports CNY deposits and has strong security measures.

Step 2: Complete Identity Verification

To comply with anti-money laundering (AML) regulations, you’ll need to submit personal identification details. For higher transaction limits, advanced verification—including uploading photos of your ID card—may be required.

Step 3: Enter the Fiat Trading Zone

Once verified, navigate to the fiat trading section. Here, you can purchase USDT using RMB. Most exchanges don’t charge fees for fiat trades, which makes this method cost-effective.

Step 4: Transfer Funds to Your Spot Wallet

After purchasing USDT, you must transfer it from your fiat account to your spot wallet (also known as the coin-to-coin account). Only then can you use it for broader cryptocurrency trading.

Why transfer between accounts?
Exchanges separate fiat and digital asset operations for security and compliance. The fiat account handles RMB deposits and withdrawals, while the spot account manages crypto trades.

Understanding Spot Trading

Now that your USDT is in the spot wallet, you’re ready for spot trading—the act of exchanging one cryptocurrency directly for another at current market prices.

For example:

Spot trading platforms resemble stock market interfaces, complete with real-time price charts, order books, and K-line (candlestick) graphs that help traders analyze trends.

Unlike OTC trading, spot trading doesn’t involve bank transfers or identity checks for each transaction. It’s fast, flexible, and gives you access to thousands of digital assets across multiple trading pairs.

One key advantage? You avoid constant conversion back to fiat, reducing friction and enabling quicker responses to market movements.

👉 See how real-time spot markets unlock new opportunities for smart traders.

Key Differences Between OTC and Spot Trading

FeatureOTC TradingSpot Trading

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Let’s break down the main differences clearly:

Frequently Asked Questions (FAQ)

Q: Can I buy crypto directly with RMB on all exchanges?
A: Not directly. Due to regulations, most exchanges use OTC as a workaround. You’ll trade RMB for USDT through peer-to-peer deals rather than direct deposits.

Q: Is USDT really worth 1 USD?
A: Yes, under normal conditions. USDT is designed to maintain a 1:1 value with the U.S. dollar. While minor fluctuations occur in secondary markets, redemption mechanisms keep it closely anchored.

Q: Why can’t I trade my newly bought USDT immediately?
A: Because it starts in your fiat account. You must manually transfer it to your spot wallet before using it in cryptocurrency trades.

Q: Are OTC trades safe?
A: On trusted platforms with escrow protection, yes. The exchange holds the seller’s crypto until you confirm payment, preventing scams.

Q: Do I need KYC to do spot trading?
A: Usually yes. Most compliant exchanges require identity verification even for internal crypto trades to meet global regulatory standards.

Why Start with USDT?

For beginners, starting with USDT offers several advantages:

Once you hold USTD, you can explore diverse opportunities—from trading high-growth altcoins to participating in staking or yield-generating protocols.

👉 Turn your first stablecoin into a gateway for broader digital asset exploration.

Final Tips for New Traders

  1. Start Small: Begin with low-value trades to get comfortable with the interface and processes.
  2. Secure Your Account: Enable two-factor authentication (2FA) and never share your login credentials.
  3. Track Prices: Learn to read basic candlestick patterns and volume indicators—they’re essential tools in spot trading.
  4. Stay Informed: Follow reliable sources for news on market trends, regulatory updates, and technological developments.

By mastering OTC and spot trading fundamentals, you lay a strong foundation for more advanced strategies like futures, margin trading, or decentralized finance (DeFi) participation.

Core Keywords (Naturally Integrated)

With this knowledge, you're now equipped to confidently enter the world of digital asset trading—starting with just one minute of learning.