Exit liquidity meaning is when someone buys a token at a high price, allowing earlier holders to sell and exit with profit. It usually happens during fake pumps or hype when the price looks like it will keep rising, but it’s actually a trap for new buyers.
Exit liquidity matters in crypto because it causes heavy losses for small investors and lets whales or insiders exit safely. This creates false excitement, misleads new traders, and damages trust in legit projects. Also, many times, it also hides the real value of tokens and uses social media for fake promotions.
This guide will explain the exit liquidity definition and common types of exit liquidity traps. We also explain how to identify an exit liquidity trap and how you can avoid it with some best strategies.
What Is Exit Liquidity in Crypto?
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