Good day steemians how are you all doing today I hope all is well and you all are having a nice and amazing day, asa for me I'm fine and also enjoying my day as well.
Today I will be taking part in the new tech quiz contest season 22 organize here in the Steem4bloggers community by the creative @malikusman1
What Is Liquidity? |
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The term liquidity in cryptocurrency simply refers to the process whereby a token is being swapped for another token mostly a government issued or approve fiat currency.
For further explanation we as steemians after blogging for several weeks and the rewards we earn from it which is always in form of steem, now the process of converting our steem tokens to our local currency is liquidity of tokens.
Did You Provide Liquidity To Any Dapp? |
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For quite some time now I have been hearing of Dapps mostly here on the Steemit platform and even rme and hungry-griffin have been talking and mentioning this in their blogs but I actually do not know what this really means.
So for this reason my answer to this question is that I have not or never for once provided a liquidity to any Dapp not in any way but I sincerely hope that so far I'm still active here on Steemit I'm going to someday provide liquidity for a Dapp.
Pros And Cons Of Providing Liquidity. |
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Some of the various pros and cons of providing liquidity are;
Pros
- It helps investors to be able to respond more rapidly to changes in the financial market.
- Liquid assets can certainly help to reduce the chances of lose of assets
- Liquid assets can be used to buy assets at a lower price at any given time
Cons
- Inflation can certainly affect the liquid assets thereby causing it to loose it value as compared to other assets in the financial market
- Liquid assets does not offer lots of gain in return
This will be the end of my entry and I will like to invite some of my friends @prime33, @felix12, @edidiongeffiong to join me and drop their entry
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