#TradingPairs101
In Binance, "Trading Pairs" are the foundation of buying and selling cryptocurrencies. Simply put, a trading pair represents two cryptocurrencies that can be traded against each other. For example, the pair "BTC/USDT" means that you can buy or sell Bitcoin (BTC) using Tether (USDT).
How do trading pairs work?
Base Currency: This is the first currency in the pair, which is the currency you are buying or selling.
Quote Currency: This is the second currency in the pair, which is the currency you use to pay or receive when selling the base currency.
For example, if the price of the BTC/USDT pair is 70,000, it means that 1 Bitcoin (BTC) is equivalent to 70,000 Tether (USDT).
When buying, you buy the base currency (BTC) using the quote currency (USDT).
When selling: you sell the base currency (BTC) for the quote currency (USDT).
Importance of trading pairs:
Price determination: Trading pairs help determine the value of one cryptocurrency against another.
Liquidity and market depth: The most popular pairs like BTC/USDT or ETH/BTC have high liquidity, which means you can make large trades without significantly affecting the price. This is important for traders who rely on speed and accuracy.
Access to different markets: Trading pairs allow you to trade between different cryptocurrencies, and even between cryptocurrencies and fiat currencies (like the US dollar).
