Liquidity generally refers to the ease with which an asset can be exchanged for cash without affecting the price of that asset. To maintain the balance of any market, maintaining liquidity is of prime importance. As the number of cryptocurrencies is growing, so is the crypto market. But not all cryptocurrency exchanges can capture a large customer base.

It is necessary to admit that the importance of liquidity for crypto exchanges and traders. As more liquid the exchange would be, more users would be attracted to it.
 
Importance of liquidity in cryptocurrency exchange
Market stability
The more liquid a market is, the more stable it is. Due to the volatility in the pricing of cryptocurrencies, majorly bitcoin, the market has become more unstable and variable, when buying or selling Bitcoin, there are always plenty of traders on the other side willing to fill the order with minimal impact on the asset’s price. Regular fluctuations in the pricing affect the reliability of crypto assets. Thus, with efficient liquidity in a crypto exchange, the manipulation in pricing could be controlled and stability in functionality would be experienced.
Better and fair prices are involved
A large number of buyers and sellers in a liquid market contribute to a fair price for the participants. For example, a robust marketplace with high trading activity ensures that sellers could sell their digital assets at competitive prices while buyers could bid at higher prices. This creates an equilibrium market price that is fair for both buyers and sellers.
Transaction time
With higher liquidity and more traders, orders get filled much faster than low liquidity environments. While this is obviously convenient and better user experience, it is also advantageous for higher frequency traders. Particularly in times of high volatility, being able to enter and exit a position quickly can make a serious impact on profits.

More about liquidity here:

Despite knowing the benefits of liquidity, many businesses overlook the need to implement high-liquidity options during white label crypto exchange development.

If you are planning to build your crypto exchange, ByteBulls White Label Crypto Exchange is always your best choice.  We fortify your exchange with high-liquidity options and industry-leading features to achieve world-class security and performance.

For more details:
Website: https://www.whitelabel-exchange.com/
Telegram: https://t.me/kate8806
Skype: katherine_5065
WhatsApp: +1 978 885 3218
Email: hello@bytetrade.io