#Liquidity101 What is Liquidity in the Crypto World?

Liquidity describes how easily an asset can be bought or sold without significantly affecting its price. In the crypto market, assets with high liquidity such as BTC and ETH can be traded quickly due to their large volume and activity. Conversely, smaller coins often have low liquidity, making it difficult to enter or exit large positions without slippage. Liquidity is very important for traders as it affects the efficiency of order execution. Major exchanges like Binance provide liquidity pools to ensure the market remains active.