Order Book- spread and slippage

The book has two sides, asks (red) and bids (blue). Asks are sometimes called offers. Asks consists of orders from other traders offering to sell an asset - BTC in this case. Bids are orders from traders offering to buy an asset.

The best ask (8711.93) is the lowest price at which someone is willing to sell. That is, the lowest price at which you can buy BTC.

The best bid (8711.46) is the highest price at which someone is willing to buy. That is, the highest price at which you can sell BTC.

These two quantities are also called the top of the book since they are the best prices available. The best ask is always larger than the best bid. If this was not the case, you could make a quick profit by buying at the best ask and immediately selling at the best bid.

The mid price is the average of the best bid and best ask: (8711.93 + 8711.46) / 2 = 8711.695

The difference of the best bid and ask is called the spread: 8711.93 - 8711.46 = 0.47. The spread is proportional to what would pay if you were to buy a small quantity of BTC and sell it again immediately. You can think of it as a fee you are paying for transacting in the market. The spread is one of the most important quantities of a market and is typically used as a measure of liquidity

 Liquid markets have a small spread and little slippage.