#TradingPairs101

In cryptocurrency and traditional markets, a trading pair represents two assets that can be exchanged for one another. It shows how much of one asset (the quote currency) is needed to purchase a unit of another (the base currency). For example, in the trading pair BTC/USDT, BTC is the base currency, and USDT is the quote currency. This pair tells you how much USDT it costs to buy 1 BTC.

There are two main types of trading pairs: crypto-to-fiat (e.g., ETH/USD) and crypto-to-crypto (e.g., ETH/BTC). Fiat pairs are commonly used by beginners because they're easier to understand. Crypto pairs are useful for experienced traders who want to move between tokens without converting to cash.

On Centralized Exchanges (CEXs), you’ll often see hundreds of trading pairs, allowing for flexible swaps. On Decentralized Exchanges (DEXs), trading pairs depend on available liquidity in user-created pools.

Understanding trading pairs helps you navigate markets, calculate profit or loss, and find the most efficient way to trade. Not all tokens are directly paired, so you may need to use intermediary pairs (e.g., trading Token A to BTCBTCBTC, then BTC to Token B).

Mastering trading pairs is key to efficient, cost-effective trading across any platform.