#Liquidity101

Liquidity is considered one of the most important concepts in the world of trading and cryptocurrencies, as it directly affects the ease of buying and selling assets without significantly impacting the price. Simply put, liquidity means the availability of buyers and sellers in the market.

When liquidity is high, you can execute your trades quickly and with a small difference between the buying and selling price (the spread), which reduces trading costs and increases market efficiency. In markets with low liquidity, you may find it difficult to enter or exit a trade at the price you want, and you may be exposed to sharp fluctuations.

In decentralized platforms, liquidity pools play a significant role, where users provide liquidity in exchange for rewards. Understanding liquidity is not just for experts, but a necessity for every trader who wants to reduce risks and achieve better results in the market.