You see a crypto priced at $100, place an order, and end up buying it at $101.
What happened?
It could be slippage — and understanding it can help you make more informed trading decisions.
📊 What Is Slippage?
Slippage is the difference between the expected price of a trade and the actual price at which it executes.
For example, imagine you want to buy a cryptocurrency at $100.
By the time your order executes, the price you receive is $101.
That $1 difference is slippage.
🔎 Why Does Slippage Happen?
Slippage can occur for several reasons:
1. Market Volatility
Crypto prices can move quickly. The price may change between the moment you place an order and when it executes.
2. Low Liquidity
When there aren’t enough suitable buy or sell orders available at the expected price, your order may execute at a different price.
3. Large Orders
A large order may need to match with several available orders at different prices, resulting in a different average execution price.
🟢 Can Slippage Be Positive or Negative?
Yes!
Positive Slippage: Your trade executes at a better price than expected.
Negative Slippage: Your trade executes at a worse price than expected.
Slippage can affect both buying and selling.
🛡️ How Can You Manage Slippage?
Here are a few things to consider:
Consider Limit Orders: You can specify the maximum price you’re willing to pay when buying or the minimum price you’re willing to accept when selling. However, your order may not execute.
Check Market Conditions: Be cautious when prices are moving rapidly.
Review Available Liquidity: Before placing a large order, consider the available orders at different price levels.
Remember, no method eliminates every trading risk.
💡 The Key Takeaway
The price you see isn’t always the price you receive.
Understanding slippage helps explain why execution prices can differ from expectations, especially in fast-moving or less liquid markets.
The more you understand how trades execute, the better prepared you are to navigate the crypto market.
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Educational content only. Not financial advice. DYOR and verify information through official sources.
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