Projects like yours secured a Legal Services with Rengangyongsheng

discover their experience of working with us

A perfect fit for our business

I highly recommend Legal to any entrepreneur or business seeking top-notch services for their company formation.

Tom

Best for Crypto Licenses

Best company for Crypto Licenses! Kudos to the team for making the incorporation of our company really smooth

Charlotte

Fast and Reliable

Quick set-up and straightforward process. It was a smooth process, we are happy to have chosen Rengang as our Partner for incorporations, globally.

‌Daniel

Highly recommended!

They are undoubtedly top-level experts when it comes to licensing and registrations in the crypto and web3 industry. Highly recommend!

James

Excels at adapting to challenges

Rengang excels at adapting to challenges and demonstrates a perfect understanding of our business needs.

Alexander

A fruitful cooperation

As a result of the fruitful cooperation with Rengang, Yellow Card obtained a VASP registration, fast and without any legal complications.

Jack

HOW DOES OUR EXPERT HELP YOU TO SUCCESSFULLY LAUNCH YOUR PLATFORM

Examples of Rengang's assistance with OTC exchanges

Rengang deals with OTC platform trading by helping clients ensure regulatory compliance and cybersecurity of their OTC projects. Here are the main services we can provide for your over the counter crypto exchange.

Assessing the need for a license
The preparation of any crypto OTC platform for launch starts with assessing the need for a license. Depending on the nature of the project, the services included, and the general aspirations of the owner of a crypto OTC desk, our specialists define whether a company requires a license or not.

Despite the fact that a license is not necessary, it is advisable in many cases to improve the reputation, security, and general trustability of an OTC cryptocurrency broker. If the license is required, our lawyers undertake the procedure and prepare all the mandatory documents as requested by the regulator.

Forming and registering an OTC exchange
The need for a license is defined, and a team of lawyers starts preparing your OTC trading platform for launch. The procedure usually comprises the following steps:

Choosing a fitting regulator;
Shaping up a ready-made company or building one from scratch;
Preparing the whole package of required documentation;
Aligning the project with AML-CFT and other compliance requirements;
Drafting a detailed business plan;
Arranging the IT infrastructure of the platform;
Drafting and submitting a licensing application on the client’s behalf.
Rengang always oversees the process from the very first step until the company is ready to step into the big market.

Ensuring AML-CFT compliance
All OTC crypto brokers, whether licensed or not, must comply with the local AML-CFT policies of the country of their registration. The compliance procedure includes drafting all the necessary compliance documentation, assigning a responsible AML officer, and educating the key shareholders on the AML-CFT guidelines. The best OTC crypto exchange always adheres to the AML-CFT stipulations.

This is an intricate legal process that requires intervention from a professional lawyer. At Rengang, we fully undertake the implementation of all compliance procedures, making sure that your OTC exchange is good to go before its official launch.

Providing access to banking gateways
A stable banking gateway is crucial in many regards. Often, it is needed to streamline on-ramping and off-ramping solutions, allowing clients to trade crypto for fiat and back. At the same time, your company will always need a corporate bank account for its in-house expenses, which might sound like an easy job to get but whenever crypto is involved, most banks get cautious.

Establishing connections between crypto companies and banks is one of the pillars of Rengang’s experience. We commit to finding an appropriate banking solution within the timeframe requested by our clients.

Ensuring ongoing compliance
Regular regulatory reports, technical audits, compliance documentation, and other administrative aspects of running a crypto company can pose a real-time challenge. Ongoing legal support and advice upon request come along with every package. Rengang will assist your OTC exchange company even after its launch and tackle any arising legal issues.

LEGAL SERVICES FOR OTC EXCHANGES

Common services for OTC exchanges and their regulation

Over-the-counter (OTC) is a method of crypto trading that is independent of the market and is not influenced by its prices. Hence, it is popular for large-scale trading and among people who don’t trust centralized exchanges. The OTC trading process is conducted outside a crypto exchange, directly between the buyer and the seller. An OTC broker usually works as an intermediary in the transaction, navigating both parties through it, ensuring deep liquidity, matching the most fitting buyers and sellers for particular operations, and providing security guarantees and insurance against potential scams.

OTC crypto trading is often a priority whenever large sums of money are involved. This method allows parties to transact without influencing market prices or being bound by them. The price, as well as liquidity and the entire settlement process, are negotiated between the two parties of the transaction, which makes over-the-counter trading largely self-governed and private compared to trading on a traditional crypto exchange.

How to launch your own crypto OTC platform? What are the legal implications and possible pitfalls that may appear on the way? Do you need a license to run an OTC exchange? Rengang will answer all of these questions as transparently as possible.

Managing liquidity

An OTC trading platform can function either as a separate entity or as part of a cryptocurrency exchange. Such famous exchanges as, for example, Binance or Kraken, have their own inbuilt OTC trading services. Regardless of your particular project type, you will have to concern yourself with providing enough liquidity for successful trades.

Quite often, traders themselves can participate in deepening the liquidity, acting as market makers and benefitting from the price gaps between OTCs and traditional exchanges at the same time. High liquidity, which often pertains to OTC platforms, is the consequence of large trading orders being predominant in over-the-counter trading. It allows OTCs to provide trading services without altering or gravely impacting market prices.

Lower risk of slippage

One of the widely perceived benefits of OTC platforms over traditional exchanges is the reduction of potential slippage. Slippage refers to the difference between the expected price and the actual price that results from a trading deal and can commonly take place when the market price drops in the transaction process.

Controlling slippage on an OTC platform is fairly simple since they are not subject to constant market fluctuations and changes in prices. Since all the deals are executed directly between buyers and sellers, on their pre-negotiated conditions, no risk of slippage arises.

AML-CFT and reporting

OTC trading platforms are more private and less transparent than traditional exchanges, and this is exactly why they are in close focus of the regulators around the world. Such transactions, completed in full privacy and on terms negotiated between two anonymous parties, are largely viewed by the higher authorities as potentially fraudulent, money laundering, or even financing terrorism.

Henceforth, AML-CFT compliance and regular reporting are mandatory. Regardless of the need for licensing, in order to run an OTC exchange legally, you will have to apply certain AML compliance measures. The full compliance document package, as well as basic AML-CFT training for the key shareholders of your startup, can be provided by Rengang.

Banking solutions for OTC platforms

At OTC platforms, parties trade cryptocurrencies that are not listed on crypto exchanges. When transactions are made between crypto and fiat pairs (on- and off-ramping), an appropriate banking settlement is required. Not every bank will agree to cooperate with an OTC exchange, especially the one in its startup stage, hence a lawyer’s assistance might be required. Rengang has a long history of providing OTC exchanges with bank solutions for their trading services.

Legal Services in OTC Exchange