#Liquidity101
A highly liquid market offers several advantages to traders, investors, and the broader ecosystem. It fosters a more stable and efficient trading environment, benefiting all participants. High liquidity ensures that prices remain competitive and accurately reflect an asset's intrinsic value. Additionally, it reduces the risk of market manipulation by making it difficult for individual actors to exert undue influence.
Participants in liquid markets can also enjoy:
Lower transaction costs due to tighter bid-ask spreads.
Reduced price slippage, especially for large trades.
Greater market stability and reduced susceptibility to price.
#liquidity 101
