Liquidity is the ability to buy or sell an asset quickly, without causing significant price fluctuations. Learn more here.

Liquidity is the lifeblood of efficient crypto trading. It determines how quickly and smoothly assets can be bought or sold at stable prices. And yet, many traders tend to overlook liquidity’s role in reducing 

, tightening spreads and improving execution speed — all of which directly impact profitability.

Bybit has made significant strides in improving liquidity across its trading pairs, ensuring that traders benefit from faster execution, better pricing and minimal market impact across markets. This article will explore what liquidity is, why it matters, how to measure it — and why Bybit offers one of the most liquid trading environments in the industry.

Liquidity is the ability to buy or sell an asset quickly, without causing significant price fluctuations. In crypto trading, liquidity is determined by trading volume, order book depth and market participation. A highly liquid market ensures tighter spreads, faster order execution and reduced slippage, providing a more stable and efficient trading experience.

. When many buyers and sellers actively place orders, transactions occur swiftly and price movements remain stable. Conversely, a lack of liquidity can lead to price gaps, delays and higher trading costs.

A deep order book is key to strong liquidity, with large quantities of buy and sell orders spread across multiple price levels. This means that when a trader places a large order, it’s absorbed by the existing orders, without drastically moving the market price. In contrast, an illiquid market has fewer participants and a shallower order book, so that a single order for an asset could drastically shift its price. This leads to greater price volatility and higher execution costs.

 play a crucial role in maintaining liquidity by continually placing buy and sell orders. By providing a steady flow of orders, they help stabilize prices and narrow the 

, ensuring smoother trading conditions for all participants.

In crypto trading, liquidity also varies between 

 Spot liquidity is reflected in lower spreads, meaning traders can buy or sell assets at more competitive prices. In contrast, lower slippage is the key measure in other types of trading.

Liquidity has an impact on every aspect of trading, from execution speed to profitability. The following considerations make liquidity a key factor for traders.

A tighter bid-ask spread ensures traders 

 at fairer prices. This is especially beneficial for 

 who rely on small price movements for profits.

Minimal slippage and better price stability

Liquidity determines the degree to which an order affects price levels. In a highly liquid market, a $100,000 trade might move an asset’s price by only a fraction of a percent, while in an illiquid market, the same trade could cause a sharp price swing.

Liquidity allows traders to execute orders almost instantly at the expected price. In contrast, low-liquidity conditions may mean that, due to market fluctuations, orders will take longer to fill, or may execute at unfavorable prices.

During sudden price movements, a deep order book absorbs large trades, preventing extreme spikes or crashes. This is crucial for maintaining price stability in volatile markets: traders can execute strategies with greater confidence, knowing that price fluctuations will be more controlled.

How to identify and measure liquidity in crypto trading

While many traders assume liquidity is measured simply by trading volume, a deeper analysis is required to assess true liquidity conditions. The following section explains how traders can evaluate liquidity effectively.

A deeper order book means that multiple buy and sell orders exist across different price levels, supporting efficient trade execution with minimal price movement This is a strong indicator of liquidity, since it reflects a market’s ability to handle both small and large orders without sudden price fluctuations. 

 pair on Bybit has consistently shown strong order book depth, with the top three bid and ask levels holding significantly higher quantities as compared to other platforms. This enables smoother execution for all traders, from retail investors to institutions. 

A true test of liquidity is the degree to which the market price moves when executing a large order. In a highly liquid market, trades are absorbed across multiple levels, ensuring minimal slippage and price disruption. 

Traders can simulate a large market order by entering a significant trade volume and observing how much the price shifts before execution. A market order that significantly changes the last traded price suggests lower liquidity and potential inefficiencies in trade execution. 

For example, in order to move an asset’s price from $1,877.64 to $1877.66 on Bybit, you’ll need to buy 57.02856 + 168.67890 + 26.21569. Likewise, in order to move the price from $1,877.63 to $1,877.60, you’ll need to sell 114.28408 + 16.35036 + 17.30490.

Order absorption measures how well a market handles large trades without causing price spikes or slippage. A highly liquid market has deeper buy and sell walls, allowing it to process large transactions smoothly.

Here’s an example: For Bybit’s ETH/USDT pair, large trades require consuming multiple price levels before affecting the last traded price. This ensures stability even during high trading volumes. A trader purchasing 30 ETH only absorbs Level 1 and Level 2 sell orders, whereas on lower-liquidity platforms, multiple levels would be affected, increasing price volatility.

This high order absorption capacity is vital for traders executing large transactions, ensuring consistent execution quality across all market conditions.

The bid-ask spread represents the difference between the highest bid price (what buyers are willing to pay) and the lowest ask price (what sellers are willing to accept). A narrower spread indicates stronger liquidity, because it means there are many active buyers and sellers competing for the best prices. Conversely, a wider spread suggests a more illiquid market, leading to higher trading costs and greater price fluctuations.

The first consideration is to compare the order book depths between different exchanges. Exchanges with higher quantities at each price level (for both bid and ask) suggest higher liquidity.

Step 1: Identify the initial market price

Step 2: Simulate a market order (without executing it)

Step 3: Calculate the final execution price

Step 5: Compare the market impact between exchanges

Bybit’s approach to liquidity: Building the best trading experience

Bybit has implemented advanced liquidity solutions to ensure traders experience tight spreads, fast execution and minimal slippage.

One of Bybit’s most significant advancements is its Retail Price Improvement (

) Order, a first-of-its-kind feature designed to enhance liquidity specifically for retail traders. Unlike traditional market-making models, which oftentimes prioritize institutional orders, RPI orders provide retail traders with access to deeper liquidity pools, ensuring better prices and deeper order book support.

Bybit has also strengthened its liquidity infrastructure through strategic partnerships with institutional liquidity providers. These collaborations increase market depth, reduce slippage and improve overall trading efficiency across spot markets.

The impact of Bybit’s liquidity innovations

Following the introduction of RPI orders and enhanced market-making strategies, Bybit has seen substantial improvements in liquidity across key trading pairs. The results are clear:

Bybit’s liquidity enhancements have created a more efficient and stable trading environment, benefiting both retail and institutional traders.

For retail traders, Bybit’s liquidity improvements mean faster order execution, lower trading costs and better pricing. By ensuring better liquidity conditions, Bybit makes it possible for traders to execute their strategies with greater confidence and efficiency.

For high-volume and institutional traders, deeper liquidity pools ensure that large orders can be executed without significantly moving the market price. This is crucial for traders managing large portfolios or executing algorithmic trading strategies.

Bybit’s liquidity solutions also enhance overall market efficiency, improving execution quality across all trading pairs.

Liquidity is the backbone of efficient crypto trading, shaping everything from execution speed to price stability. Bybit has consistently demonstrated its commitment to providing a highly liquid market through innovations like RPI orders, deep order book depth and strategic partnerships with institutional liquidity providers.

Whether you’re a retail trader seeking tighter spreads and faster execution or an institutional trader executing large orders with minimal price impact, Bybit will offer you a best-in-class trading experience. 

If you value fast execution, minimal slippage and a robust liquidity environment, Bybit is the exchange of choice.

Intermediate

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Liquidity in crypto trading: Why it matters and how to spot the best conditions

Bitcoin's Price Officially Breaks $100,000: 4 Key Drivers Behind the Milestone

 has officially crossed the $100,000 mark, setting new all-time highs. Once dismissed by many as a scam or speculative experiment, Bitcoin has grown to become one of the top 20 most valuable assets globally, with a total market cap nearing $2 trillion. Over the past decade, Bitcoin has undergone one of the most significant perception shifts in financial history, with mass media and institutions reversing their skepticism and embracing its potential. The $100K milestone represents more than just a price point—it’s the result of years of increasing mainstream acceptance. Institutional investors are integrating Bitcoin into their portfolios, Bitcoin ETFs are breaking records, favorable global economic trends are driving demand, and political shifts are creating a more supportive environment. Let’s take a closer look at the key factors behind Bitcoin’s rise to over $100,000.

US Bitcoin ETFs: Validation For Traditional Investors

On January 10th, the SEC granted regulatory approval for 11 U.S. Bitcoin exchange-traded funds (ETFs). While European-listed exchange-traded notes (ETNs) had been available for years, the approval and launch of U.S.-based Bitcoin ETFs marked a pivotal moment for Bitcoin. This milestone not only eliminated significant barriers to entry for traditional investors but also reshaped public perception of Bitcoin as a legitimate and regulated financial asset. Here are some highlights.

Macroeconomic Factors: Bitcoin as a Hedge

Global economic conditions have increasingly positioned Bitcoin as an alternative investment for investors looking to protect and grow their wealth. Traditional investment options like bonds and savings accounts have become less attractive due to a combination of low interest rates, rising inflation, and negative real yields in several major economies. These shifts have driven both retail and institutional investors to view Bitcoin as a hedge against economic instability and a store of value, often referred to as digital gold.

Political Support: A Crypto-Friendly Climate

The political and regulatory climate is increasingly tilting in favor of cryptocurrencies, providing strong momentum for Bitcoin's growth. Governments and policymakers worldwide are recognizing the potential of blockchain technology and digital assets, shifting from skepticism to proactive engagement. These political tailwinds, coupled with regulatory advancements, are fostering a more secure and predictable environment for Bitcoin, boosting investor confidence.

Continued Institutional Adoption: Bitcoin Goes Mainstream

Institutional investors and corporations are driving Bitcoin’s transformation from a niche digital asset to a widely accepted investment and financial tool. Seen as a hedge against inflation, a store of value, and an alternative to traditional financial instruments, Bitcoin’s appeal has surged among major players in the financial world. This growing adoption is a key factor in Bitcoin’s price reaching new highs, underpinned by its integration into treasury strategies, investment portfolios, and payment systems.

Conclusion: Your Opportunity to Join the Bitcoin Momentum

As Bitcoin soars past the $100,000 pricepoint and sets the stage for further growth, there’s no better time to take your trading to the next level. Bybit (powered by SATOS) invites Dutch traders to participate in our 

, where you can can win an VIP trial to enjoy 

This exclusive event is your chance to experience Bybit’s industry-leading VIP Program while capitalizing on Bitcoin’s historic rise. Don’t miss out—

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Bitcoin Officially Breaks $100,000: 4 Key Drivers Behind the Milestone

Ondo Finance has launched a new institutional-grade bridging solution for tokenized real-world assets (RWAs), leveraging LayerZero’s decentralized verifier network (DVN) for enhanced security.

The S&P 500 rose 0.57% to a record high, driven by investor focus on upcoming inflation data, despite concerns over new tariff threats and the Federal Reserve's cautious stance on rate cuts.  Coindesk Indices, an index measuring broader cryptocurrency market performance was down by 2.60%, with Bitcoin and Ether dropping by 4.08% and 3.27%, respectively in the past 24 hours.

Today's top performer is FTM, which surged 9.9% following Sonic Labs' partnership with OctavFi for advanced on-chain financial management.

Sonic Labs (FTM), founded in 2018, formerly known as Fantom Foundation, supports the development of Sonic, a new layer-1 blockchain designed for fast, efficient transactions and secure connectivity to Ethereum. It focuses on creating decentralized applications and managing governance for the Sonic ecosystem, which is set to launch later in the year. 

 to bring institutional-level financial management, advanced on-chain treasury management, and financial reporting to its protocols.

Check Out the Latest Prices, Charts, and Data of 

 a new institutional-grade bridging solution for tokenized real-world assets (RWAs), leveraging LayerZero’s decentralized verifier network (DVN) for enhanced security. This solution enables seamless transfers of USDY, Ondo’s yield-bearing tokenized US Treasuries, across Ethereum, Arbitrum, and Mantle. The bridging architecture incorporates trusted bridge providers like PolyhedraZK and Axelar, along with Ondo’s own DVN, ensuring secure and decentralized transaction validation. The integration is available now via Ondo’s frontend and Stargate Finance, with support for additional chains planned.

Yesterday, BTC spot ETF flows recorded a total outflow of $122.8M, including $36.1M from GBTC and $86.7M from non-GBTC funds.

Check Out the Latest Prices, Charts, and Data of  

, requiring wallet and social handle registration by Dec 2, 2024, 2 PM UTC. Eligibility criteria include completing 3 transactions across 2 apps on Movement's testnets and finishing Road to Parthenon quests. After TGE, users can claim MOVE tokens on Ethereum Mainnet or Movement Mainnet, with the latter offering a 1.25x multiplier. More airdrop seasons will follow post-mainnet launch.

Beginner

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Ondo Launches Institutional-Grade Bridging for Tokenized RWAs with LayerZero Security

How to Use the Bybit Card to Earn 15% Cashback on Top of All Black Friday Deals

Originally an American tradition, Black Friday has evolved into a global shopping event and is now a significant date in the Dutch retail calendar. In the Netherlands, Black Friday has grown in popularity, with major retailers like Bol.com, Coolblue, MediaMarkt, and Bijenkorf offering deals across a wide range of products.

As a nation known for valuing savings, Black Friday provides an excellent opportunity to stack discounts and maximize value. Bybit's Black Friday Card Promotion adds an extra layer of savings with 

 on both online and offline purchases. Explore how the Bybit Card works, along with practical examples of savings during Black Friday shopping, to make the most of this year’s event.

How Can You Take Part in This Black Friday Promotion?

Joining the Bybit Black Friday Promotion is simple! Follow these steps to start earning 

 ontop of all your Black Friday deals Weekend:

Practical Examples of Savings With Bybit Card

Simply input your Bybit Card details at checkout or use instant payment methods like 

 to complete your online purchases seamlessly. Cashback is automatically applied to your account, making savings effortless.

For offline purchases, use your Bybit Card as a physical card or digitally through 

. As long as the store accepts PIN payments, you’ll earn cashback rewards instantly.

After the Black Friday promotion ends, the Bybit Card reverts to its 

 offer, allowing you to save on all your purchases through the rest of the year. Whether you’re buying Sinterklaas gifts, stocking up for Christmas, or grabbing post-holiday deals, the savings keep rolling in.

The Bybit Card is your ticket to maximizing savings on the biggest shopping day of the year. From tech to festive essentials, every purchase becomes more rewarding.

Learn more about the Bybit Card Black Friday Promotion 

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How Can You Use the Bybit Card to Earn 15% Cashback on Top of All Black Friday Deals?

Bybit Learn

Bybit Earn

Bybit Launchpad gives users access to the latest and pre-listed tokens. Users can commit a certain amount of MNT or USDT to earn new tokens. Learn how it works.

In the ever-evolving world of cryptocurrencies, innovation is the name of the game. As the crypto ecosystem matures, new platforms and tools are emerging to address the burgeoning market’s needs. Among these innovations, crypto launchpads have carved a niche for themselves, acting as springboards for new projects to gain traction, secure funding and establish a community. These launchpads serve as a bridge between project developers and potential investors, ensuring a smoother and more transparent token launch process.

Crypto launchpads aren’t just platforms; they’re ecosystems that foster growth, trust and collaboration. By providing a structured and secure environment for token sales, they mitigate risks associated with 

, ensuring that both investors and developers can engage in a mutually beneficial relationship.

As we delve into the world of crypto launchpads, one platform you can count on is Bybit Launchpad. In this article, we'll explore the unique features and benefits of Bybit Launchpad, and see how it stands out in the crowded space of crypto launch platforms.

Bybit Launchpad is a token launch platform that gives investors early access to new and pre-listed tokens from promising projects directly on Bybit. As a way to make things more exciting for users, Bybit recently introduced new features to Bybit Launchpad, branding this version as Launchpad 3.1.

Users can commit a certain amount of MNT or USDT tokens toward each new project and earn new tokens. This event is available for any user who has completed the Identity Verification Level 1 requirements, and has deposited either MNT or USDT in their Bybit Wallet. In addition, this feature is limited to users who aren’t from restricted countries (see below under “Requirements”).

You’re probably wondering what the main differences are between the old Bybit Launchpad and the new Bybit Launchpad 3.1. Take a look at the table below for a clearer picture.

Each Launchpad project goes through four stages: 

You also have two different ways to participate in Launchpad by committing either MNT or USDT tokens. Read on to find out exactly how you can participate, and how the platform works. 

The Snapshot period usually lasts between three to five days. During this period, the daily average amount of MNT or USDT in your Funding Account, Spot Account and Derivatives Account (or Unified Trading Account and Inverse Derivatives Account) will be recorded automatically through hourly snapshots. 

 to earn tokens, note that the daily average amount of MNT in your Funding Account, Spot Account and Derivatives Account (or Unified Trading Account and Inverse Derivatives Account) during this period must be equal to or greater than 50 MNT. The snapshot will be updated at 3AM UTC every day. Due to the high volume of asset calculations, there might be a delay in updating your daily average MNT balance.

For the Funding Account, please note that MNT staked in Flexible Savings, Launchpool, Lending as well as any MNT used as collateral in Crypto Loans will automatically be counted in the snapshot of your Funding Account. MNT staked in other products on Bybit Earn (e.g., Dual Asset) will not be included.

For the Derivatives Account, your wallet balance — which may be affected by realized P&L — will be counted.

 to earn tokens, you’ll need to fulfill one requirement — the daily average amount of USDT in your Funding Account, Spot Account and Derivatives Account (or Unified Trading Account and Inverse Derivatives Account) during this period must be equal to or greater than 100 USDT, and will be rounded down to the nearest integer.

Due to the high volume of asset calculations, there might be a delay in updating your daily average USDT balance.

Want a chance to earn more tickets beyond the default ticket issued upon your USDT commitment? There are two primary ways in which you can do so. 

Please note that you can only select one path for additional ticket acquisition beyond the initial ticket: either through VIP status or through maintaining/trading assets. 

If you’re a Bybit VIP, here’s some good news for you! When you commit USDT, you’ll be able to automatically receive 

 additional lottery tickets. This brings your total ticket count to the maximum of 

 lottery tickets, which also means that you have 

If you have yet to become a Bybit VIP, you can participate in our Bybit VIP Program simply by fulfilling one of two criteria — asset balance and monthly trading volume. Alternatively, if you’re already a VIP user on another cryptocurrency exchange, simply screenshot your current VIP status or your monthly trading volume from that exchange and email it to premium@bybit.com. 

For more information, you can check out our 

. Join today and you’ll not only get three additional lottery tickets, but lots of other perks as well! Bear in mind, VIP status typically takes T+1 to activate, so kickstart your application promptly! 

that all assets staked in Bybit Flexible Savings, Launchpool and Lending will automatically be counted in the snapshot of your Funding Account. All assets staked in other products on Bybit Earn (e.g., Dual Asset Mining) will not be included. Two distinct asset snapshots are taken into consideration:

Your daily average MNT or USDT balance = the sum of all hourly snapshots / 24 hours

Let’s assume that on Oct 31, 2023, Alice signs up with Bybit and makes a deposit of 100 MNT every hour to her Funding Account only. Her wallet balance snapshots will be recorded as follows:

In this case, her average daily wallet balance on Oct 31, 2023 would amount to 1,250 MNT, based on the following calculation:

(100 MNT + 200 MNT + 300 MNT + 400 MNT + … + 2,400 MNT) / 24

Let’s assume that on Oct 31, 2023, Bob signs up on Bybit and makes a deposit of 200 USDT

. His wallet balance snapshots will be recorded as follows:

In this case, his average daily wallet balance on Oct 31, 2023 would amount to 2,708 USDT, based on the following calculation:

200 USDT + 400 USDT + 600 USDT + 800 USDT + … + 4,800 USDT) / 24 

 of them are chosen for the USDT lottery draw, you’ll receive twice the total tokens allocated for each selected USDT lottery ticket. 

This means that if 30 tokens are allocated to each selected USDT lottery ticket, you’ll receive 60 tokens in total. 

Once the Subscription period starts, head to the 

, select your preferred project, and commit either through the Subscription track or the Lottery track. 

If you’ve chosen the Subscription track, click on 

 to commit a certain amount of MNT toward the new project during this period. You can commit multiple times during the Subscription period; however, the maximum amount of MNT you can commit depends upon the final daily average combined MNT balance in your Funding Account, Spot Account and Derivatives Account (or Unified Trading Account and Inverse Derivatives Account) over the Snapshot period. 

Each project also has a hard cap on the maximum number of tokens allocated to each subscriber.

Final token allocation amount = (amount of MNT you’ve committed during the Subscription period / total amount of MNT committed by all participants) × total amount of new tokens allocated for the project

• Number of MNT committed by Alice: 1,250 MNT

• Number of MNT committed by all participants: 1,000,000 MNT

• Total amount of new hypothetical token (“β”) allocated for the project: 3,000,000 β

In this case, Alice’s final token allocation will be (1,250 MNT / 1,000,000 MNT) × 3,000,000 β = 3,750 β.

If you hold MNT under your Funding Account, Spot Account and Derivatives Account (or Unified Trading Account and Inverse Derivatives Account), please 

 transfer MNT to your Funding Account for subscription during the Subscription period.

If you’ve chosen the Lottery track, click on 

to commit 100 USDT to enter all your lottery tickets into the draw. If you hold the maximum number of 

The probability of winning for each USDT lottery ticket = total number of winning tickets/ total number of tickets issued × 100%

If you have multiple winning tickets, you’ll receive multiple token allocations.

Bybit Launchpad: Everything You Need to Know

Grab Up to 5,000 USDT in Rewards

Grab Up to 5,000 USDT in Rewards