#liquidety101 ---
💧 Understanding liquidity is essential for any crypto investor!
Liquidity represents how easily an asset can be traded without significantly affecting its price. Highly liquid coins (such as BTC or ETH) have high trading volumes and low spreads between buy and sell prices. In contrast, smaller projects with low liquidity can experience sudden price movements, which increases risk.
For a balanced portfolio, it is ideal to have a combination of high-liquidity coins and projects with growth potential.
Risk management also means knowing "where and when" you can exit a position.
📊 In my portfolio, I have combined BTC (high liquidity) with strategic altcoins for diversification.
#Liquidity101