Plain English
The bid-ask spread is the difference between the highest price someone will buy at and the lowest price someone will sell at. On Bitcoin you might see a $1 spread on a $100,000 coin. On a thin altcoin, the spread can be 2–5% of the price.
How it actually works
Spread is essentially the cost of immediacy. Market makers post bids and asks; the spread is their profit margin for providing liquidity. Tight spreads (a few basis points) mean a deep, competitive market; wide spreads mean illiquid, risky to size into.
What it means for you
Spread is a hidden fee you pay every round trip. A 1% spread plus a 0.1% trading fee plus 0.5% slippage means a 1.6% drag on a single in-and-out trade. For active strategies, this destroys edge fast. Pick venues with tight spreads on your pair, and use limit orders to capture the spread rather than pay it.
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Educational content only. Not investment, tax, or legal advice.