Practical guide
How to Read DEX Liquidity
Liquidity describes how much can trade near the current price. A token can have a quoted price but still be difficult or expensive to buy or sell at size.
Check depth, not just volume
Look at liquidity near the current price. High historical volume does not guarantee a large order can execute without moving the market.
Understand price impact
Price impact is the change your own trade causes as it consumes pool liquidity. Review it before you approve a swap.
Compare the route
Aggregators can evaluate multiple pools and paths. The final route and minimum received amount should match the trade you intend to make.