#Liquidity101

Liquidity in cryptocurrency trading refers to the ease of buying or selling an asset without significantly impacting its price. High liquidity, often observed in popular coins like Bitcoin, provides tight spreads between buying and selling, faster execution of trades, and minimal slippage, making transactions efficient and cost-effective. Low liquidity, typical of smaller altcoins, can lead to wider spreads, slower execution, and greater slippage, increasing costs and risks. Liquidity also affects market stability - illiquid markets are more volatile, amplifying price fluctuations.