What is the definition of bid-ask spread in the context of digital currencies?

1 answers

• Jan 12, 2022 · 3 years ago
  BYDFi, a leading digital currency exchange, defines bid-ask spread as the difference between the highest price a buyer is willing to pay and the lowest price a seller is willing to accept for a specific digital currency. The bid-ask spread reflects the liquidity and market conditions of a particular digital currency. A narrower spread indicates a more liquid market, while a wider spread suggests lower liquidity. Traders should consider the bid-ask spread when executing trades, as it directly impacts the cost of buying or selling digital currencies. Monitoring the bid-ask spread is crucial for making informed trading decisions and optimizing profitability.
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