#Liquidity101 What is liquidity and why does it matter in trading?

Liquidity is the ease with which an asset can be bought or sold without significantly affecting its price. In other words, it is the ability to quickly turn an asset into cash with little variation in value.

🔹 A market with high liquidity (like the pair $BTC BTC/ $USDC on Binance) has many buyers and sellers. This means smaller spreads, faster executed orders, and less unexpected volatility.

🔹 In contrast, a market with low liquidity may experience large price fluctuations with larger orders, high slippage, and difficulties in closing positions.

💡 For traders and investors, choosing assets with good liquidity is essential to minimize risks and optimize strategies.

Want to scalp? Swing? Hold? It all starts with the liquidity of the asset you are trading.