Lesson 1 of 6 · 4 min
What “the price” actually is
The big number at the top of a market is the price of the last trade: the most recent moment a buyer and a seller agreed. It is a record of the past, even if only a few seconds old.
What you can do right now is shown in the order book. The bid is the highest price any buyer is currently willing to pay. The ask is the lowest price any seller is currently willing to accept. They sit at different prices because neither side has given way yet.
The gap between them is the spread. If you buy immediately you pay the ask; if you sell immediately you receive the bid. Buy and sell straight away and you lose the spread before any fee is charged. On a busy market like BTC it is tiny. On a thin one it can be large, and it is the first thing worth checking before you trade it.
None of this is a trick. The spread is simply the price of wanting something now instead of waiting for it.
Your turn
Find the spread on BTC
- Open the BTC market.
- In the order book, read the lowest ask and the highest bid. The spread is the difference.
- Compare it with the last price. Is the gap bigger or smaller than you expected?
What you just learned
The price on screen is the last trade. Buying at once costs the ask, selling at once gets the bid, and the spread is the gap.