How to Increase Your Liquidity in the Cryptocurrency Exchange Platform?
To launch a successful cryptocurrency Exchange software, it is crucial to check that your crypto-exchange has high liquidity or not. Before understanding how to gain high liquidity, lets us discuss briefly what is liquidity and why it is important?.
What is Liquidity?
Generally, liquidity is the degree whereas a digital asset can buy (or) sell for cash without affecting the cost of your asset. For the reason, the concept of liquidity in cryptocurrency indicates that exchanging orders are matched with each other in the minimum time. Higher the liquidity in your crypto-trading platform, the cost of cryptocurrency also would be high.
Let us consider, world’s most popular crypto exchange platform like Binance (or) Coinbase, because of high liquidity in the platform, they are achieving to a greater extent.
What does cryptocurrency liquidity providers do?
Cryptocurrency is unstable — that is the cost may vary each day. Market makers (or) liquidity providers play an important role in keeping up the stability by enhancing the trading volume. Moreover, marketers don’t work for free and they are making plenty of money from this business. They play on the price gap of cryptocurrency exchange and also chare an extra commission fee for each transaction.
Achieve high liquidity in Your crypto-trading platform:
If the liquidity is low, crypto-exchanges usually try to engage market makers by the following methods:
Author Signature :
I am Tim Josh, working as a technical content writer having more than 3 years of experience. My interests are blogging, photography, and traveling.
I am Tim Josh, Working as a Digital Marketing Analyst at Osiz Technologies having 3 years of experience. My Interests are blogging, pencil sketching and traveling...