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What Is the Significance of the 2% Rule in Measuring a Crypto Asset’s Liquidity?

It measures the USD trade size needed to move the price by 2%, with a higher value indicating better liquidity.
Greeks.Live09.11.25

What Is the Significance of the 2% Rule in Measuring a Crypto Asset’s Liquidity?

The 2% rule is a simple metric used to estimate liquidity by calculating the trade size (in USD) required to move the market price of a crypto asset by 2%. A larger required trade size indicates higher liquidity, as the market can absorb large orders without significant price impact.

It helps traders gauge the cost of executing large orders and the risk of slippage.

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