none of you actually knows how liquidity works

Please explain how liquidity works

3000 $anon for the best explainer

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Liquidity refers to how easily you can trade tokens in a market without causing big price swings. Imagine it like water in a pool:

High Liquidity

Ex; A large pool has plenty of water, so you can easily take some (buy/sell tokens) without draining it too much or affecting the water level (price).

Low Liquidity

Ex; A small pool has less water, so taking even a little can cause big changes in the level.

In crypto markets, high liquidity means more stable prices and faster trades, while low liquidity can make trading slower and riskier.