I've noticed that many beginners in crypto get confused with basic trading concepts. I decided to share what I've learned over the years in the market — about ask and bid, it's really fundamental if you want to avoid losing money.

First, the main point. Ask and bid are two sides of the same coin. When you look at a exchange's order book, there is always a red part ( this is the ask — the price at which sellers are willing to sell the asset ) and a green part ( this is the bid — the price at which buyers are willing to buy ). The difference between the lowest ask price and the highest bid price is called the spread.

Why is this important? Because the spread directly depends on liquidity. Take Bitcoin — it has huge volumes, so the spread is microscopic. But if you try trading some lesser-known altcoin, the spread can be just wild. Market makers specifically profit from this — they buy at low bid prices and sell at high ask prices, pocketing the difference.

But there's another pitfall — slippage. This is when you want to buy at a certain price, but end up paying more. It happens because when you place a market order, the exchange starts taking liquidity from the order book, and if your volume is large, it begins to reach into higher, more expensive levels. On volatile markets, slippage can be over 10 percent — that can really hurt.

I remember once placing a large buy order for an altcoin, thinking I’d get the price at $100, but the average price ended up at $112. I simply miscalculated the volume in the order book. Since then, I always split large orders into smaller parts.

There’s also the option of positive slippage, when the price moves in your favor. But that’s rare, mostly on very volatile markets.

What do I do now to minimize losses? First, I split orders into several small ones instead of one big one. Second, I carefully watch the order book before placing anything. Third, on decentralized exchanges, I always consider gas fees — sometimes they eat up all the profit from avoiding slippage.

And yes, limit orders are your best friend if you’re not in a rush. They guarantee you’ll get the price you want, or not at all. Plus, there won’t be unpleasant surprises with the price.

In general, ask and bid are not just numbers in an app — they are what market makers profit from and inattentive traders lose money on. If you’re just starting out, just remember: on low-liquidity assets, the spread is big, slippage is real, and it’s always better to split your order into parts. That’s the whole science.