When you trade on a crypto exchange — you never just buy a coin. You always trade one asset against another.
This is called a trading pair.
For example: BTC/USDT
This means you are trading Bitcoin against Tether (USDT).
Every trading pair has two parts:
Base currency
The first currency in the pair — the one you are buying or selling.
In BTC/USDT — Bitcoin is the base currency.
Quote currency
The second currency — the one used to price the base.
In BTC/USDT — USDT is the quote currency.
The price shown is always how much quote currency you need to buy one unit of base currency.
Example:
BTC/USDT = 80,000
This means 1 Bitcoin costs 80,000 USDT.
USDT — Tether
Most popular. Stable at $1. Most trading pairs use USDT.
USDC — USD Coin
Another stable dollar coin. Considered more transparent than USDT.
BTC
Some altcoins are paired against Bitcoin. Example: ETH/BTC tells you how much Bitcoin one Ethereum costs.
ETH
Some tokens are paired against Ethereum.
Buying:
You want to buy 0.5 BTC at $80,000.
Cost = 0.5 × $80,000 = $40,000 USDT
Selling:
You sell 0.5 BTC at $85,000.
Receive = 0.5 × $85,000 = $42,500 USDT
Profit = $2,500 USDT
Understanding trading pairs helps you:
Sometimes you need to go through multiple pairs to reach your target coin.
Example:
You have USDT and want to buy a small altcoin that only has a BTC pair.
Step 1: Buy BTC with USDT — BTC/USDT
Step 2: Buy altcoin with BTC — ALTCOIN/BTC
Each step costs fees — so always check if a direct USDT pair exists first.
USDT pairs — price shown in dollars. Easy to understand profit/loss.
BTC pairs — price shown in Bitcoin. You can profit in BTC terms but lose in dollar terms if Bitcoin drops.
For beginners — always use USDT pairs. Dollar denominated profit and loss is much easier to track.
In the next topic we will learn what market cap is and why it matters more than price alone.