An order book is a live list of buy and sell orders for an asset, with size at each price. Bids are buys. Asks are sells. The spread between the best bid and best ask is a liquidity and tightness signal. Tight spreads mean many competing quotes. Wide spreads mean thin books or uncertainty. Depth is how much size sits at each level. Deep books absorb large trades. Shallow books jump on modest size.
Traders read bid walls as support and ask walls as resistance. Those walls can be spoofed: large orders placed and cancelled. Market orders take the best available price now. Limit orders rest on the book until they match. Order books run traditional finance and centralized crypto exchanges. Early DEXs could not support them on-chain, which is why AMMs appeared.
Later DEXs such as dYdX run order books on specialized chains fast enough for matching. An order book is a real-time ledger of buy and sell orders for an asset on an exchange, displaying the quantities traders want to buy or sell at various price levels. Bids represent buy orders (what buyers will pay); asks represent sell orders (what sellers want).
The spread, the gap between highest bid and lowest ask, indicates market efficiency and liquidity. An order book lists bids and asks. Matching engines at Nasdaq or Binance pair them. AMMs replaced that list with a pool.
Order Book Visualization
Interactive order book showing bids, asks, and market spread. Click orders to remove them or add new ones.
Asks (Sell Orders)
Bids (Buy Orders)
Add New Order
- • Tighter spreads = more liquid market
- • Bar length shows order size
- • Click orders to select/remove them
- • Add orders to see spread changes