๐ Post#Liquidity101
Liquidity is a crucial concept in crypto trading. It refers to how easily an asset can be bought or sold in the market without causing significant price changes. High liquidity means there are lots of buyers and sellers, making it easier to execute trades quickly at stable prices. Low liquidity can lead to slippage โ when your order executes at a worse price than expected. Centralized exchanges usually offer higher liquidity due to their large user bases. In contrast, some decentralized exchanges may have low liquidity, especially for lesser-known tokens. As a trader or investor, always consider liquidity before entering or exiting a position.
