Good day to you all amazing and wonderful Steemit bloggers in the Steem4bloggers community how are you all doing I sincerely hope that you all are in good health and enjoying your day.
Today I will be taking part in the tech quiz contest organize by @malikusman1 which we are going to discuss about liquidity in cryptocurrency
What Is Liquidity? |
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The term liquidity may sound very confusing from a nutshell but in a wider scope of sphere of knowledge it means something were out of the league of our imaginations expectation
Liquidity out of know were simply refers to the general crypto term given to the act of swapping one tokens to another and mostly fiat currencies in the crypto market.
Did You Provide Liquidity To Any Dapp? |
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No I haven't provided any liquidity for any Dapp at least not yet but I really hope that one day I would be able to do so as long as it will be profitable and also I have been hearing of Dapps on the Steemit platform and sometimes I wonder how it normally works
That is why I really commen the programmers that we have here on the Steemit platform for their hard work in creating and developing the various Dapps that we have here on Steemit
Pros And Cons Of Providing Liquidity. |
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The various pros and cons involve in the process of providing liquidity are;
Cons
- Providing Liquidity on a certain level dose not provide interest in return unlike other crypto tokens
- Providing Liquidity at a certain level may cause loss when intending to buy or swapping for other tokens
Pros
- Liquidity allows investors to overcome some certain degree losses in the fluctuation of crypto market
- Liquidity which is in fiat money allows investors to be able buy other tokens with a potential of gain in the open market
This will be were I'm going to call it a day and I sincerely hope that you all got to learn something from my post today, as you all are now able to know what is meant by the word Liquidity in cryptocurrency and some of the various things involved.
I will like to invite @kyrie1234, @sushanta83 & @radleking