Order Book
A real-time list of buy and sell orders for a cryptocurrency, organized by price level.
Explained Simply
An order book shows all pending buy orders (bids) and sell orders (asks) for a trading pair. Bids are sorted from highest to lowest; asks from lowest to highest. The gap between the highest bid and lowest ask is the spread. Deep order books (many orders at each price level) indicate high liquidity and lower slippage. Centralized exchanges like Coinbase Pro and Kraken use order books. DEXs using AMMs do not have traditional order books. Reading order books helps traders understand supply/demand and potential price movements.
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