$BTC $ETH $BNB As I have been telling you, my project was the creation of a Lithium (LTH) cryptocurrency with good liquidity and thus create good competition in the cryptocurrency market. But due to lack of money I had to abandon the project.
When it comes to investing, one of the most important factors to consider is the ease of buying or selling an asset. After all, making profits is meaningless if you can't profit from it.
And in this post I want to refer to the liquidity of crypto assets, this refers to the ease of buying or selling a coin or token without causing significant price movements. It is influenced by the depth of the market, the depth of the order book and the bid-ask spread.
Why is liquidity so important?
The liquidity of cryptoassets plays a key role in reducing investment risk and facilitating smooth exit strategies for investors. Investors and traders prefer liquid crypto markets.
The more liquidity an asset has, the more stable and less volatile it tends to be. A liquid market means that buyers and sellers are always ready to transact, allowing them to buy and sell digital assets whenever they prefer and take advantage of trading opportunities.
In cryptocurrencies, for example, the liquidity of Bitcoin and ETH are the highest since they have many active buyers and sellers, which allows for fast and fair trade execution. This causes their prices to change less. Today, many people consider Bitcoin digital gold to be a safe haven that will eventually replace real gold. And all this is thanks to its large market share and liquidity.
