#Liquidity101

Liquidity in the crypto market refers to how easily assets can be bought or sold without causing major price changes. High liquidity ensures faster trades, tighter bid-ask spreads, and more stable prices, making the market efficient and attractive to traders. It boosts confidence, reduces slippage, and lowers transaction costs. In decentralized finance (DeFi), liquidity pools enable token swaps and are vital for DEX operations. Low liquidity, on the other hand, can lead to high volatility, price manipulation, and difficulty in executing large orders. Overall, liquidity is essential for a healthy, functional, and reliable crypto trading environment.