Common Liquidity Problems
The cryptocurrency industry is still facing significant liquidity challenges, both in centralized finance (CeFi) and decentralized finance (DeFi) spaces. CEXes are struggling with thin order books and wash trading, while decentralized exchanges DEXes find it hard to attract enough liquidity providers.
Furthermore, some liquidity problems go beyond CeFi and DeFi, affecting the entire crypto market. One such issue is liquidity fragmentation. The same assets are being traded across multiple platforms and blockchains, leading to liquidity dissipation and making it difficult for traders to find adequate amounts for seamless trading 24/7.
Addressing these and other liquidity issues is crucial to ensure a robust and diverse liquidity ecosystem that can help promote the widespread adoption of crypto assets and DeFi services.
To learn more about liquidity problems and possible solutions, visit the Kinetex blog.
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