Liquidity: definition and meaning
Liquidity is how easily an asset can be bought or sold without moving its price much.
Why it matters
Low liquidity means wider spreads and bigger slippage when you trade.
Related terms
- Bid-ask spread
The spread is the gap between the highest price buyers will pay (bid) and the lowest price… - Slippage
Slippage is the difference between the price you expected and the price you actually got, … - Order book
An order book is a live list of buy and sell orders at different prices for a market.…
Guides that explain more
- Market Orders vs Limit Orders
- What Is DeFi (Decentralized Finance)?
- What Is Market Capitalization in Crypto?
Educational content only, not financial advice.