#TradingPairs101 How do trading pairs (base vs quote) work?

*The Base Currency is the commodity.

*The Quote Currency is the price, the tag you put on the commodity.

Let's see it in Action on Binance (Pair: ETH/USDT, Price: $3,500)$ETH

• Base Currency: ETH

• Quote Currency: USDT

• Price: 1 ETH costs 3,500 USDT.

BUY ACTION:

YOUR GOAL: For the price of the pair to rise. If it rises to $4,000, you can sell your ETH and receive more USDT than you initially spent, generating a profit.

SELL ACTION:

YOUR GOAL (IF YOU'RE CLOSING A BUY): Sell for more than you bought to realize your profit in USDT.

Understanding the Base vs. Quote dynamic is the foundation of everything. It tells you what you are buying, what you are paying with, and, most importantly, against what you are measuring your success.