#Liquidity101

Liquidity in crypto refers to how easily a digital asset can be bought or sold without significantly affecting its price. High liquidity means there are many buyers and sellers, leading to faster trades and tighter spreads. Major cryptocurrencies like Bitcoin and Ethereum typically have high liquidity due to strong demand and active markets. In contrast, low-liquidity tokens can suffer from price slippage and longer trade times. Liquidity is essential for healthy market functioning, reducing volatility and enabling efficient price discovery. It also affects the usability of assets in trading, DeFi, and payments. Liquidity is influenced by exchange volume, token popularity, market depth, and integration across platforms. Strong liquidity builds trader confidence and supports overall market growth. #Crypto #Liquidity #Trading