Hard to say. If by cutting a deal, you mean buying quantities below spot, what's to prevent the buyer from turning around and selling on exchange, @ spot?
I doubt it's below spot but you never know. The whole point of OTC trading is buying and selling large amounts without moving the market.
Some deals would completely destroy the price in the short term if done on exchanges. Equally they could drive it through the roof as well. If you didn't want to do either then you'd have to drip feed it over a period of days which few might have the patience for.
I understand what you're saying, buying OTC not to cause slippage. The question still stands, if buying below spot, what's to prevent the buyer from turning around and selling the whole thing on an exchange, @ spot?
If buying above spot, why not buy @ spot on exchange, in tranches, like it's typically done?
Anyhow, if this was a viable strategy, it would work much better now, pre-halving, with current, big, block reward (which causes more slippage when sold).
I doubt it would be below spot at all let alone low enough to make it worth sending straight to an exchange.
try to paper buy 50k BTC by tallying asks that you could potentially hit and keeping slippage down.
50K BTC is the current block reward for about half a month of mining. As in for the entire Bitcoin, *all the miners in the world*. With 1/2 the reward, it would be almost a month's worth of mining (28 days). Not for a single hashfarm, the entire Bitcoin network!
*Of course* you would cause serious slippage.
Again, if this trick worked, it would be much more effective now, with 25BTC block rewards, rather than post-halving (with 12.5BTC block rewards).
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Investors are not traders, so do not put the time in to decide if their large bids can be hit in a freak dump, nor are they concerned about slight price variations. But to buy 50k, it would move the price up much further than desired and it would take days to weeks to buy that much at 1k here and 500 there.
Investors with 50k BTC ($32mil at current rate) to spare are not idiots. They didn't get at this sort of money by throwing it away on ridiculous deals.
This is assuming that there is a mining farm with 50k sitting around, which it is willing to unload.
This is much less likely than Joe Shmoe having 50k BTC & willing to unload. Because I can guarantee you there are individuals holding such sums, but mining farms? Unlikely.
