๐ง How does liquidity affect the crypto market?
Liquidity is the ease of buying or selling an asset without significantly altering the price. When liquidity is high, the market becomes more stable, orders are executed quickly, and volatility decreases.
In times of low liquidity, any purchase or sale can cause sharp movements, increasing slippage, volatility, and the risk of manipulation.
Therefore, understanding liquidity is essential for operating more securely โ especially in small altcoins, where the impact on price is much greater.
