Glossary - ChicksX

Liquidity Ratios Financial metrics assessing a company's ability to meet short-term obligations.

Liquidity Ratios These are critical financial metrics that assess a company's ability to cover its short-term obligations using its most liquid assets. Common liquidity ratios include the current ratio and quick ratio. The current ratio measures a firm’s capacity to pay off short-term liabilities with its current assets. The quick ratio is more stringent, excluding inventory from current assets. In the context of a crypto/fiat exchange like ChicksX, liquidity ratios help determine the platform’s ability to fulfill users' withdrawal requests and maintain smooth operations under variable market conditions.