#Liquidity101 Liquidity** refers to how easily an asset can be bought or sold in a market without affecting its price. High liquidity means that assets can be traded quickly with minimal price fluctuations, something that is often seen in major currencies, stocks, or cryptocurrency pairs like BTC/USDT. Low liquidity means fewer buyers or sellers, resulting in wider spreads and potential volatility. In finance, cash is the most liquid asset, while properties or collectibles are less liquid. In cryptocurrencies and DeFi, liquidity is vital for efficient trading, lending, and yield generation. Market makers, liquidity funds, and exchanges play a crucial role in maintaining healthy liquidity in the markets.