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.

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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.

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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 Lending

Bybit lending involves matching lenders and borrowers of an asset with underlying collateralized loans to earn interest and for trading. Explore the high APR & lending.

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Crypto lending is nothing new, but it has grown into billions in 

 (TVL) on certain lending platforms in recent years. This service is favored by many traders and institutions primarily for its lending convenience and, most importantly, the versatility to earn high annual percentage yields. 

As the vulnerability of the banking system spreads, Bybit strives to provide the most reliable and transparent crypto lending services by learning from past events. Beyond our competitive hourly interest offerings, we also bring state-of-the-art risk management systems, ensuring users' assets are secured throughout the process. 

Bybit Lending uses a pool for lenders to contribute their idle crypto assets and earn high-interest payouts from borrowers. In this way, Bybit serves as the intermediary, bridging the gap between borrowers and lenders in the crypto environment. 

Fund depositors (lenders) in the lending pool earn hourly interest. The collected funds are available for traders (borrowers) to trade marginal products, or to invest in Bybit Earn products. Borrowers must deposit the required amount of collateral, depending upon the lender's terms, in order to borrow crypto assets. These loan terms are varied and can be as short as one day whenever the daily redemption is available.

Bybit Lending offers flexible deposit and redemption, meaning users can redeem anytime if the redemption window is still available. However, the lending system will enter a cool-down period once the service reaches either 100% capacity or the daily redemption limit, whereupon the withdrawal function will cease until the system refreshes every hour. 

The redeemable amount from the asset pool is calculated automatically by the system based on the Loan-to-Pool ratio, depending upon the crypto asset 

. Bybit will update the APR and interest hourly based on market conditions and the actual interest income generated by the loan amount. 

The Bybit asset pool accumulates deposits from lenders, and the built-in matching system in Bybit Lending matches borrowers' needs to a lender. In return, the lender earns APR from the pool, creating a win-win situation for participants. The funds in the pool serve as liquidity for the platform, to be used solely to support users' trading needs. 

The APR payout on Bybit Lending incentivizes lenders to earn interest income whenever they deposit funds into the asset pools available to borrowers. The APR is an adjusted payout that’s calculated hourly based on real-time market conditions. Depending upon the chosen contract and loan asset, lenders can enjoy a high APR. 

The interest rates are variable and updated every 10 minutes to reflect changes in borrowing demand, resulting in hourly payments. To ensure the safety of your assets, Bybit manages the risks of lent assets using multiple measures, such as collateral value ratios, conservative liquidation thresholds, and an Insurance Fund. 

The APR is calculated with the following formula:

 = (Total Revenue per Hour/Unredeemed Principal per Hour) * 24 * 365.

Once your funds are successfully lent out after depositing at T (rounded up to the next hour), the interest will accrue at T+1, accumulating hourly on the principal amount. Upon redemption, the accumulated interest will be paid along with the principal.

: Historical returns are not indicative of future returns. Bybit does not undertake to repay principal and interest or pay any other form of property income return in currency, kind or equity within a certain period of time.

Of the interest generated by the depositor's loans, Bybit retains 20% as a service fee. The depositors of the asset pool share the remaining 80%, and interest earnings will be distributed upon redemption. 

*Please note that historical returns are not indicative of future returns. 

Users of Bybit Lending can earn passive income in multiple ways. Here are some of the strategies traders can consider. 

 Borrow From Liquidity Providers to Lend on Bybit

Bybit Lending is a good investment vehicle for traders who want to hold onto their crypto for asset appreciation without selling their crypto, at the same time letting their money do the heavy lifting for a passive income. 

The high APR payout on Bybit allows investors to earn sustainable passive income from our platform. One option is that a participant can access liquidity from other crypto liquidity providers and lend the crypto on Bybit. Traders can borrow crypto assets from crypto platforms of their choice via OTC lending or crypto loans. These borrowed funds can be repurposed by depositing them as a lender on Bybit Lending to earn lucrative APR with a flexible redemption environment. 

: We do not endorse any financial advice, external platforms or services throughout this content. They are facts obtained from credible sources for educational purposes only.

Traders looking to maximize their profits can look through the token list available on the Bybit Lending platform to determine the crypto asset with the highest demand from borrowers based on its APR. The higher the demand, the higher the APR provided. Traders who have idle cryptocurrencies can then choose to exchange their cryptocurrencies for these assets (if they don’t already have them) and participate in their respective lending pools to reap the rewards of the high APR. By keeping an eye on the token list and only participating in lending pools with the highest APR, traders will be able to maximize their profits.

 assets from one platform to another. For example, a trader could borrow USDT at 5% APR and lend USDT at 5.5% APR, yielding 0.5% of the profit margin. Arbitrage opportunities are common strategies, but lending and borrowing rates are dynamic, meaning traders must be alert to catch these opportunities quickly. 

Bybit Lending offers high interest payouts for lenders on certain coins, to be paid hourly starting an hour after you’ve successfully deposited with Bybit Lending. 

Loans contributed to asset pools are immediately made available for borrowers. Bybit Lending guarantees that all depositors can redeem funds at their discretion, with successful redemption credited immediately. 

We utilize comprehensive risk management systems and high-security technology to secure your assets, ensuring your lent assets stay safe. 

Bybit Lending Sign-Up: Step-by-Step Guide

Becoming a lender on Bybit Lending is a straightforward process. Here’s a step-by-step guide to help you get started. 

Once logged in to your Bybit account, you can navigate to the menu and click on 

(UTA) asset page, where you can access the 

 function by logging in to your Bybit Spot wallet. 

: Bybit Lending is currently only available on the Bybit App (4.16.0 and later) and Lending on Bybit Web will be released soon. Stay tuned for the updates.

 to access the complete list of available crypto assets. Then, enter the amount you'd like to lend from your available account balance. Agree to the terms and conditions to proceed with your 

Once you've verified all of your details, click on 

 to finalize your transaction. Bybit’s team will process the request, which should take less than five minutes to confirm the purchase.

You’ll be prompted with a notification to confirm your purchase. Then, you can again access the 

page to preview bonus details, including redemption limit, estimated APR yields and your loan utilization rate. There’s also an 

 breakdown so you can check your hourly income details. 

To ensure the safety of lent assets, Bybit employs comprehensive risk management measures, including collateral value ratios, liquidation thresholds, and an Insurance Fund. With Bybit Lending, investors can confidently grow their cryptocurrency holdings, knowing their assets are fully protected throughout the lending process.

How is the APR in Bybit Lending determined?

The APR in Bybit Lending depends on the Loan-to-Pool ratio and increases/decreases along with supply and demand. This APR is refreshed every 10 minutes, and interest is accrued every hour.

Bybit Lending offers the safest, most flexible and transparent lending environment for lenders and borrowers to access crypto in seconds. Whether you're using them for margin trading or yield arbitrage purposes, our products are customized to suit your preferences. Traders should do their due diligence when investing in financial products, and only invest based on what they can afford to lose, as all investments come with risks. 

: The above content is strictly for educational purposes only. This is not financial advice. Should traders intend to use the products, please seek professional advice before investing. This content will be used for translations. In any case of translation inaccuracy, the English version will prevail. 

Bybit Lending: A Complete Walkthrough to Crypto Lending

Grab Up to 5,000 USDT in Rewards

Grab Up to 5,000 USDT in Rewards