Liquidity is a key component of a healthy exchange in the cryptocurrency space. Most cryptocurrency exchanges suffer from liquidity problems, causing problems for institutions and trader whales to get their orders filled.
Apart from causing huge amounts of frustration, low liquidity becomes very expensive for traders because of high slippage costs. Cryptocurrency pairs that don’t have the needed liquidity can also fall prey to washing trading whales.
Liquidity is such as a big matter that many exchanges fake their volumes to attract new traders on their platforms. (Reference: https://www.ccn.com/6-billion-daily-crypto-volume-is-being-faked-how-can-it-be-combated ).
Many exchanges add crypto pairs without diligent research which in turn results in low liquidity for those pairs. In this context, regulated exchanges such as Bittrex have become proactive in their listing parameters and even resorted to removing cryptocurrency pairs that have low liquidity on the exchange. (Reference: https://www.ccn.com/bittrex-will-remove-82-tokens-due-lack-liquidity-small-cryptocurrencies )
Encrybit’s research survey found that low liquidity is one of the big concerns among traders on most exchanges. Of all the traders surveyed, 36% of them complained of low liquidity as one of the challenges they face while trading cryptocurrencies.
Being at the forefront of understanding the challenges of cryptocurrency trading, Encrybit aims to reduce the liquidity friction on its upcoming exchange. (Reference: https://encrybit.io/insights/crypto-exchange-problems.html )
Following are the tactics that Encrybit will deploy to ensure there are no liquidity challenges on its trading platform:
1. Adoption of a governance model for the inclusion of new cryptocurrencies on the platform, based on extensive research and consultation
2. Support for API integration with multiple platforms
3. Provision of multiple device compatibility for trading – Web, Mobile and Desktop Applications
4. Inclusion of multiple stable coins so traders can smoothly trade with a stable base currency of their choice
5. Support for advanced order types, in addition to limit and stop orders
6. Corporate accounts to attract institutional funds
7. Incentive programs for institutional traders and retail traders
8. Native ENCX token with an intelligent business model and growth plan.
50% discount on trading fees for traders using ENCX tokens.
Surveys and extensive research of the state of the market at a given point of time to support liquidity.
Encrybit aims to reduce the friction that traders experience in many altcoin markets. With its incentive programs, modern UI, dedicated customer support, security practises and 50% discount on trading fees, Encrybit will enhance the overall trader experience. Bestow your support to our revolutionary project! Participate in the ongoing Private Sale!
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