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RE: ADSactly Crypto: What Is Liquidity In Cryptocurrency?

in #trading6 years ago

Grateful for your post, @chekohler. In my very elementary knowledge of economics, I have had the idea that the existence of liquidity in a traditional currency means a certain bonanza of it. But also that liquidity could be manipulated in order to intervene from time to time to certain interests in the economy (this has happened in my country -Venezuela- in a recurrent way in recent years, when money is released to create an illusion of bonanza).
From what I understand, in the case of crypto-currency, such manipulation would not be possible since the market is not centralized or managed by the interests of certain national economies, corporations, etc. I do not know if this will be the case? Greetings.

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Well if there is more liquidity then demand and production doesnt increase it will give rise to inflation! In the case of a fiat currency its up to the central bank to be the regulator of inflation where as with crypto its based on demand and suppy

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