#Liquidity101 Liquidity is one of the most critical factors to consider when trading in any financial market, especially in crypto. It refers to how easily an asset can be bought or sold without causing a significant impact on its price. High liquidity means tighter spreads, faster execution, and less slippage—key elements for effective trading. Major coins like BTC and ETH typically offer high liquidity, while lesser-known tokens may have wide spreads and low volume, making them riskier to trade. Always check the order book and trading volume before entering a position. Understanding liquidity helps you protect your capital and make more informed decisions.
