<Definition> A Liquidity Provider is an entity or market function that offers market participants the opportunity to trade, sustaining the formation of market liquidity. Market liquidity is the property of a market that allows large trades to be executed quickly with limited price impact. A Liquidity Provider sustains market participants' ability to execute trades against their order flow, by acting as their counterparty, quoting prices, or matching orders. This function is fulfilled by a range of market participants, one important type of which is the Market Maker, which supplies liquidity to the market by continuously signaling its willingness to buy and sell financial instruments for its own account.