What is bid/ask in cryptocurrency trading and how does it work?

3 answers

• Pearl FoxMar 27, 2024 · a year ago
  Sure! In cryptocurrency trading, the bid/ask refers to the prices at which buyers are willing to buy (bid) and sellers are willing to sell (ask) a particular cryptocurrency. The bid price is the highest price that a buyer is willing to pay for a cryptocurrency, while the ask price is the lowest price at which a seller is willing to sell. The difference between the bid and ask prices is known as the spread. When a buyer's bid price matches a seller's ask price, a trade is executed. This bid/ask system helps determine the current market price of a cryptocurrency and facilitates the buying and selling process.
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• Harry KaneMar 09, 2021 · 4 years ago
  Bid/ask in cryptocurrency trading is similar to the concept of buying and selling in any other market. The bid price represents the demand for a particular cryptocurrency, while the ask price represents the supply. When there are more buyers than sellers, the bid price increases, and when there are more sellers than buyers, the ask price decreases. This continuous fluctuation in bid and ask prices is what drives the market and allows traders to make profits through buying low and selling high. Understanding bid/ask is essential for anyone looking to participate in cryptocurrency trading.
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• psyclobeSep 25, 2023 · 2 years ago
  BYDFi, a leading cryptocurrency exchange, explains bid/ask in a simple way. Imagine you're at a flea market trying to buy a vintage comic book. The seller has set a price at which they're willing to sell the comic book (ask price). You, as the buyer, can make an offer (bid price) lower than the ask price. If the seller agrees to your offer, a trade is made. Similarly, in cryptocurrency trading, the bid/ask system allows buyers and sellers to negotiate and agree on a price. It's an essential mechanism that ensures fair and efficient trading.
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