#Liquidity101 What is liquidity, in simple terms?

Think of the market as a fair. If there are many people buying and selling the same thing (lots of "arepas" stands and many people wanting to buy them), it’s super easy to buy your arepas at the price you want and get them instantly. There is a lot of "fluidity".

But if there is only one arepas stand and no one else selling or buying, if you want one, the person at the stand can ask for whatever they want, or if you want to sell yours, no one will buy them quickly. That is low liquidity!

In the crypto world, liquidity refers to how easy and fast you can buy or sell an asset (a cryptocurrency) without the price moving much because of your transaction.