Slippage
Slippage refers to the difference between the expected price of a cryptocurrency trade and the actual price at which the trade is executed. It often occurs in highly volatile markets or when there is insufficient liquidity to fill an order at the desired price. In crypto trading, slippage can either be positive (where the trader receives a better price than expected) or negative (where the trader ends up paying more or receiving less). For example, in decentralized exchanges (DEXs), slippage can occur when a trader is buying a large quantity of a token and there isn’t enough liquidity in the pool, resulting in a higher price for the remaining tokens. To mitigate slippage, traders can set a "slippage tolerance" to limit how much price deviation they are willing to accept.
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