I had been trading meme coins for nearly 6 months , but still cant fully understand the exact meaning of liquidity….
What I know in companies liquidity means how much money you have on hand , or how much easy sellable assets you have …
However in trading / meme coins I cannot understand what does it actually mean , when I read about it online they write that it is how much you can sell without greatly impacting the price …
So I have 2 questions: 1. What can a high liquidity indicate? How can I probably take advantage of this number ?
- I noticed that liquidity is glued to the market cap, for most of the tokens I saw liquidity would be somewhere around 20%- 40% of the MC … Is this correct? What I am missing?
submitted by /u/_Alexxander
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