#Liquidity101 In simple terms, high liquidity means there’s a lot of trading activity — so you can enter and exit positions quickly with minimal slippage. Low liquidity, on the other hand, can trap you in a trade or cause unexpected losses due to price gaps.

For example, Bitcoin and Ethereum usually have high liquidity, making them safer for active trading. But smaller altcoins may be more volatile due to thin order books.

Smart traders always consider liquidity before making moves — and now, you should too.