What is an order book?

An order book is a live list of buy and sell orders for an asset, showing the prices and amounts traders want to trade at. It matters because it shows real supply and demand, not just a single price, so you can gauge how easy it is to buy or sell without moving the market. The book has two sides: bids (buy orders) stacked below the current price, and asks (sell orders) stacked above it. The gap between the highest bid and lowest ask is the spread. On Binance's BTC/USDT book, you might see a $500,000 bid wall at $60,000 and a thinner ask side above $60,050, hinting buyers are more eager than sellers right now.