An Overview On The State of Liquidity In Decentralized Finance (DeFi)

What is liquidity?

— What is slippage?

— OK, so what about spread?

— And what about speed?

Slower processing + Higher fees = Not a good place to liquidate (unless you reeeeaallly need to liquidate)

Slippage, spread and speed are a package deal.

Photo by Avi Waxman on Unsplash

How Liquidity Pools & Providers Form The Backbone of DeFi

The automated market maker algorithms serve as the conduits so to speak, so that buyers and sellers can conduct their business in a trustless, frictionless manner.

Let’s see this happen in 4 steps:

Copywriter & Website specialist | practicing ma’at & meditation | Student of data science & decentralization

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