Final answer:
The main difference is that currency futures markets settle gains and losses daily through the margin mechanism, whereas the OTC market settles them typically at the end of the contract.
Step-by-step explanation:
The major difference between the currency futures market and the OTC market (Over-the-Counter market) is that in the currency futures market, gains and losses are settled on a daily basis through the margin mechanism. This means that the profits or losses from the futures contracts are calculated each day and the margin accounts are adjusted accordingly. This is known as marking to market. In contrast, the OTC market does not have a standardized process for daily settlement. Instead, gains and losses in the OTC market are typically settled when the contract ends or is closed out, which could be at any agreed-upon time between the parties.