Greetings dear steemians how are you all doing today I hope all is well and you all are having a nice and wonderful day, as for me I'm fine and also enjoying my day as well
Today in my entry I will be submitting my entry in participation in the tech quiz contest organize by @malikusman1 here in the Steem4bloggers community.
And in my today's entry I will be sharing with you all the meaning of liquidity in cryptocurrency, my part in it and lastly the pros and cons, and I sincerely hope that you all will get to learn something from my today's post.
What Is Liquidity? |
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Liquidity in cryptocurrency is simply the common term given to the process whereby a token is being swapped for another mostly fiat currencies which are our local government issued national currency
Did You Provide Liquidity To Any Dapp? |
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No currently as we speak I haven't yet provided any liquidity for any Dapp and also to be sincere I really do not know what this really means and I would really appreciate it if someone would enlighten me a little about providing liquidity to a Dapp.
I have been hearing about Dapp throughout my entire journey on Steemit and just Yesterday after coming in contact with this contest I asked my brother @radleking about this particular question and he too isn't really frequent with what this really means.
Pros And Cons Of Providing Liquidity. |
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Now everything has a merit as well as a demerit and in this case some of the pros and cons of providing liquidity are;
Pros
- Through the process of liquidity an investor or a trader is able to buy tokens at an affordable price and at a very cheap rate.
- Liquidity helps in reducing and stopping the possible chances for loss in assets due to price fluctuation
Cons
- One of the main cons of liquidity is that liquid assets do not offer interest or gain in return
- Liquid assets can certainly loose a considerably amount of value due to price fluctuation
This will be the end of my entry and were I'm going to call it a day, thanks for your time and thanks for stopping by I really appreciate it and I will like to invite @prime33, @radleking & @felix12
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