A Liquidity Provider is a financial institution or individual that offers liquidity to markets by facilitating the buying and selling of assets. They do this by maintaining a supply of assets, ensuring that there are enough available for traders to execute their orders without significant price changes. This helps to stabilize the market and improve trading efficiency. In the context of cryptocurrency, a liquidity provider can also refer to platforms that allow users to trade digital assets easily. By providing liquidity, these platforms, such as Uniswap or Binance, enable smoother transactions and help reduce the volatility often seen in less liquid markets.