How Cryptocurrency exchange Works?
Cryptocurrencies are traded through centralized or decentralized exchanges. These transactions are driven by a certain amount of buyers and sellers. Market participants create buying and selling prices through bidding. Connections between different exchanges are limited because they tend to cluster around what users consider to be 'best' exchanges. The exchange does not trade at the same price, but price differentials usually escape even through simple market supply and demand. The option to shorten or pair trading pairs, trading pairs that offer specific options such as leverage is a big advantage. Additional drivers may include support for certain cryptocurrencies. Some cryptocurrencies support other cryptocurrencies as much as possible, while others only support a limited amount.
Price differentials often occur when users are concentrated and traded on a more popular exchange. This creates the form of isolation of all exchanges. However, some traders use arbitrage trading to help them leverage price differences and adjust prices. Even with this in mind, there are so many price differences and volatility that the prices on the exchange are not equal.
What is Liquidity System?
This is the Liquidity Aggregator. By holding a single account, platform users have access to key Exchange pricing policies and will trade through a single API. Liquidity aggregation is also important for large institutional investors. The reason is simple. Order volume is much larger and can affect the price of one exchange. That's why Liquidity Aggregators can use many exchanges to spread orders so that they do not affect the price.
Liquidity aggregation allows agencies and retailers to trade only one company and automatically delivers orders to multiple exchanges without having to deal directly with the transaction, ensuring that prices remain stable while maintaining maximum price. Exchange use.
Liquidity aggregation is an amazing concept and can be leveraged to benefit both trading platforms and traders. At present, however, there is no exchange program that provides a stable and flexible set. PrimeXBT is developing systems that use liquidity aggregation systems linked to the 12 largest exchanges (leading trading platforms in terms of options and features that come with many other features such as high leverage and short selling options)
JOIN WITH L2EXCHANGE COMMUNITY!
The cryptocurrency world is at a very early stage with many points of growth for new ways of making the current exchange system better and introducing new financial products.
Level 2 succeeds in both ways.
First, enhancing the current level of centralized exchanges to the maximum with FPGA tech allowing for latency as never seen before and customer orientation as top priority with deep understanding of what creates liquidity on the crypto market.
And secondly, providing a new product on the verge of centralization and decentralization providing safe custody with access to liquidity in trading.
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