#TradingPairs101 #TradingPairs101 – Basics of Trading Pairs in Trading

Trading pairs are one of the fundamentals of understanding financial markets – especially cryptocurrency exchanges, forex, and international stocks. Here is an accessible introduction:

🔹 What is a trading pair?

A trading pair is a set of two assets that can be exchanged for each other. It shows how many units of one asset (e.g., currency) you need to buy one unit of the other.

Format: [BASE Asset] / [QUOTE Asset]

Example: BTC/USDT means you are buying 1 BTC, paying in USDT (Tether).

🔹 Typical examples of pairs:

Pair What does it mean?

BTC/USDT You buy Bitcoin for Tether

ETH/BTC You buy Ethereum for Bitcoins

EUR/USD You buy euros for dollars (Forex)

AAPL/USD You buy Apple shares for dollars

🔹 Types of pairs:

1. Fiat/Crypto – e.g., BTC/USD, ETH/EUR

You buy cryptocurrency for fiat currency (USD, EUR, etc.)

2. Crypto/Crypto – e.g., ETH/BTC, SOL/ETH

Exchanging one cryptocurrency for another

3. Stable/Crypto – e.g., BTC/USDT, ETH/DAI

Popular for measuring the value of cryptocurrencies in “dollars”

🔹 Why are trading pairs important?

🧭 They determine the price – each pair has its own exchange “price.”

📊 They enable trading without fiats – e.g., you buy ADA for ETH without using USD.

⚖️ They affect liquidity and spread – not every pair has the same popularity and volume.

🔹 How does it work in practice?

Example: Pair ETH/BTC = 0.05

👉 This means that 1 ETH costs 0.05 BTC.

If you have 1 BTC, you can buy 20 ETH.

🔹 What to consider when choosing a pair?

Trading volume – the higher, the better the liquidity

Bid-ask spread – the smaller, the cheaper you can buy/sell

Volatility – some pairs are more unstable

Market trust – it’s better to trade on reputable exchanges

🔹 Pro tip:

👉 You don’t have to use only fiats!

If you have BTC and want to buy a new altcoin, it may turn out that only the pair ALT/BTC is available, not ALT/USD.