The impact of trading liquidity on transactions is mainly reflected in the following aspects:

1. **Trading Costs**: In a highly liquid market, the bid-ask spread is smaller, and slippage risk is lower. For example, in the foreign exchange market, when liquidity is sufficient, the spread for major currency pairs can be compressed to less than 1 basis point, whereas, in a liquidity-scarce environment, the spread may widen by several tens of times. Additionally, in markets with poor liquidity, large orders can easily trigger price fluctuations, leading to an increase in implicit costs.

2. **Market Efficiency and Stability**: High liquidity facilitates the price discovery mechanism, allowing asset prices to more accurately reflect supply and demand relationships, while also being able to absorb large trading shocks, thereby reducing extreme price volatility. For example, institutional investors enhance market depth through high-frequency trading strategies, improving liquidity and stabilizing prices.

3. **Strategy Selection and Risk Management**: When liquidity is sufficient, investors can flexibly employ strategies such as high-frequency trading and arbitrage; when liquidity is insufficient, they may need to shift to long-term holdings or reduce trading frequency. Furthermore, liquidity risk directly affects the ability to liquidate assets; in a low liquidity environment, the difficulty of stopping losses increases, which may trigger a chain sell-off.

In summary, liquidity is a core indicator of healthy market operation, and investors need to dynamically adjust their strategies according to liquidity to balance costs, risks, and returns.