#Liquidity101 #Liquidity101 Why This Matters in Cryptocurrency

In simple terms, liquidity determines how easily an asset can be bought or sold without affecting its price. In cryptocurrency, high liquidity means there is strong trading activity and enough buyers and sellers to maintain price stability. Low liquidity can lead to greater slippage, price volatility, and less efficient trades.

Major tokens like $BTC or $ETH on centralized exchanges (CEX) typically have deep liquidity. In contrast, smaller altcoins or tokens on decentralized exchanges (DEX) may have thinner liquidity, affecting trade execution.