Slippage ​

Slippage is the difference between the expected execution price of an order and the actual price at which the trade is executed. It occurs when the order size exceeds the available liquidity at a given price level and the trade “eats through” multiple levels of the order book.

Example: You expected to buy 2 BTC at $65,000, but the actual average execution price was $65,090 — the slippage was $90 (≈ 0.14%).

Causes of slippage:

• Low liquidity of the trading pair
• Large order size
• High volatility at the time of execution
• Using a market order instead of a limit order

How to minimize slippage:

• Use limit orders instead of market orders
• Split large orders into smaller ones
• Trade highly liquid pairs (BTC/USDT, ETH/USDT)
• Check order book depth before placing a large order

In DeFi, when swapping tokens through AMM platforms, users can specify maximum acceptable slippage — if the actual slippage exceeds the threshold, the transaction is automatically reverted.