Swapzone Glossary: Spread

Ever wondered why the price you get when buying crypto can differ from the price you’d get when selling it?

That difference is called the spread.

The spread is the gap between the buying price (ask) and the selling price (bid) of an asset.

Why does it matter?

1. A smaller spread generally means a smaller difference between buy and sell prices.
2. A larger spread can increase the cost of entering or exiting a trade.
3. preads can vary depending on the asset, liquidity, market conditions, and trading venue.

In simple terms, the spread shows how far apart the current buy and sell prices are.

Don’t confuse it with slippage:
Spread is the gap between the current buy and sell prices, while slippage is the difference between the expected and actual execution price.

What crypto term should we explain next?

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