CashboardGlossary · Trading
What is the bid-ask spread?
The bid-ask spread is the gap between the highest price a buyer will pay and the lowest price a seller will accept at that moment.
How does the bid-ask spread work?
On an order book, the bid is the best price anyone will buy at and the ask, or offer, is the best price anyone will sell at. The difference is the spread. BTC bid at $99,990 and ask at $100,000 is a $10 spread, or 0.01 percent.
It is a cost that never shows up on a receipt. Buy at the ask, sell straight back at the bid, and you have lost the spread without the market moving at all. Market makers earn it by quoting both sides, and they widen their quotes when volatility jumps or when they are unsure what fair value is.
Deep markets like BTC and ETH perps have tight spreads. Thin ones do not. Tokenized stocks show the difference well. During US market hours they track the underlying closely. On weekends the exchange is shut and market makers cannot hedge, so spreads on stock tokens and stock perps usually widen.
AMMs have no quoted spread, but the pool fee plays the same role. A 0.3 percent fee, say, is paid on the way in and again on the way out, so a round trip costs about 0.6 percent before any price impact.
Also called: spread, bid-offer spread.
Where does the bid-ask spread show up in Cashboard?
For eight US stocks including NVDA and TSLA, the Tokenized stocks widget shows how far the xStocks token trades from the stock itself, and does the same for a Hyperliquid stock perp if one is listed. Weekend gaps get a flag. Order book spreads are not shown.
Frequently asked questions
Who earns the bid-ask spread?
Market makers, and anyone else resting limit orders on both sides of the book. Traders who cross the spread with market orders are the ones paying it.
Where can you read more about bid-ask spread?
Related terms
Last reviewed . Market data in Cashboard comes from the providers named on each widget and may be delayed. Nothing here is financial advice.