#Liquidity101 **#Liquidity101** explains a key concept in trading and investing: how easily an asset can be bought or sold without affecting its price. High liquidity means there are many buyers and sellers, so trades happen quickly and at stable prices—think major stocks or top cryptocurrencies. Low liquidity means fewer market participants, which can cause price slippage and difficulty exiting trades. Liquidity also impacts spreads—the difference between bid and ask prices. In centralized exchanges, liquidity is often deeper, while decentralized exchanges depend on liquidity pools. Strong liquidity ensures smoother trading, tighter spreads, and better price execution—crucial for both beginners and pros.