Price Discovery vs Size Discovery

A marketplace for trading of OTC derivatives is a very peculiar and fascinating place these days. On the one side we have more or less vertically layered market structures where liquidity is provided by a limited number of market makers and there is a strong profit and loss element in the price spread. On the other side there are more flattened market structures where all participants equally contribute liquidity when providing liquidity and take it out when aggressing other dealers’ prices.