Request-for-Quote (RFQ)

Request-for-quote, or RFQ, is a trading protocol in which an investor asks one or more dealers to quote a price for a specified size, then chooses whether to trade at the best response. It contrasts with a central limit order book, where anonymous orders rest publicly. RFQ dominates markets built on dealer balance sheets, including bonds, foreign exchange, and bullion, and a client will often put three to five dealers in competition on a single inquiry.

Why it matters

Large orders reveal information, and information moves prices. Posting a 100 million dollar order on a public book invites the market to run ahead of it, while an RFQ discloses the interest only to selected dealers who quote a firm price for the full amount. The cost is dependence on dealer relationships and less pre-trade transparency, which is why regulators have pushed RFQ activity onto electronic platforms where quotes are recorded and comparable.

In the gold vs bitcoin debate

Institutional trading in both assets converges on the same structure. London gold has traded by dealer quotation for centuries, and large bitcoin blocks route through OTC desks and electronic RFQ platforms to avoid moving exchange order books, with ETF market makers using RFQ networks to source coins for creations. The parallel is telling: whatever the settlement asset, size seeks discretion. The difference lies below the trade, where bitcoin settles on a public ledger in about an hour while a London gold trade settles as a book entry against vaulted metal two days later.