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𝗪𝗵𝘆 𝗱𝗶𝗱 𝗺𝘆 𝗗𝗘𝗫 𝘀𝘄𝗮𝗽 𝗿𝗲𝘁𝘂𝗿𝗻 𝗺𝘂𝗰𝗵 𝗹𝗲𝘀𝘀 𝘁𝗵𝗮𝗻 𝘁𝗵𝗲 𝗺𝗮𝗿𝗸𝗲𝘁 𝗽𝗿𝗶𝗰𝗲 𝘀𝘂𝗴𝗴𝗲𝘀𝘁𝗲𝗱?
A token’s market or reference price is not a guaranteed execution price.
When you swap on a DEX, the amount you actually receive depends on the available liquidity, your trade size, the current pool balance, and the conditions of the swap at the time it is executed.
𝗪𝗵𝘆 𝗰𝗮𝗻 𝘁𝗵𝗲 𝗲𝘅𝗲𝗰𝘂𝘁𝗶𝗼𝗻 𝗽𝗿𝗶𝗰𝗲 𝗯𝗲 𝗱𝗶𝗳𝗳𝗲𝗿𝗲𝗻𝘁?
𝗟𝗼𝘄 𝗹𝗶𝗾𝘂𝗶𝗱𝗶𝘁𝘆
Liquidity is what allows trades to be executed.
When a pool has relatively low liquidity, a trade can consume a larger portion of the available liquidity. This can cause the execution price to move more significantly.
𝗧𝗿𝗮𝗱𝗲 𝘀𝗶𝘇𝗲
The larger the trade compared with the available liquidity, the greater its potential effect on the pool.
A small swap may have little effect on the pool price, while a larger swap can result in a noticeably different execution price.
𝗣𝗼𝗼𝗹 𝗶𝗺𝗯𝗮𝗹𝗮𝗻𝗰𝗲
The amount of each token available in a liquidity pool changes as users trade.
When a pool becomes more heavily weighted toward one asset, swapping into the scarcer asset can result in a less favorable execution rate.
𝗪𝗵𝗮𝘁 𝗶𝘀 𝗣𝗿𝗶𝗰𝗲 𝗜𝗺𝗽𝗮𝗰𝘁?
𝗣𝗿𝗶𝗰𝗲 𝗜𝗺𝗽𝗮𝗰𝘁 shows how much your own trade affects the pool’s price.
It is different from simply comparing your swap with a market or reference price.
A high Price Impact can be a warning that your trade is large relative to the available liquidity.
𝗖𝗵𝗲𝗰𝗸 𝘁𝗵𝗲 𝘀𝘄𝗮𝗽 𝗾𝘂𝗼𝘁𝗲 𝗯𝗲𝗳𝗼𝗿𝗲 𝗰𝗼𝗻𝗳𝗶𝗿𝗺𝗶𝗻𝗴
Instead of looking only at the headline token price, check the actual execution details of your swap.
Important values include:
𝗘𝘀𝘁𝗶𝗺𝗮𝘁𝗲𝗱 𝗮𝗺𝗼𝘂𝗻𝘁
The approximate amount of the output token you are expected to receive.
𝗣𝗿𝗶𝗰𝗲 𝗜𝗺𝗽𝗮𝗰𝘁
The estimated effect your trade has on the pool price.
𝗠𝗶𝗻𝗶𝗺𝘂𝗺 𝗿𝗲𝗰𝗲𝗶𝘃𝗲𝗱
The minimum amount of output tokens you are willing to accept for the transaction.
𝗦𝗹𝗶𝗽𝗽𝗮𝗴𝗲 𝗽𝗿𝗼𝘁𝗲𝗰𝘁𝗶𝗼𝗻
Helps prevent the swap from completing if the final result moves beyond the amount you have agreed to tolerate.
These values give you a much better picture of the trade than the market price alone.
𝗛𝗼𝘄 𝗦𝗧𝗢𝗡.𝗳𝗶 𝗵𝗲𝗹𝗽𝘀 𝘆𝗼𝘂 𝗲𝘃𝗮𝗹𝘂𝗮𝘁𝗲 𝗮 𝘀𝘄𝗮𝗽
STON.fi displays important execution conditions before you confirm a swap.
This lets you review the expected result and understand factors such as Price Impact and Minimum received before submitting the transaction.
For a same-chain STON.fi swap, the transaction should not simply execute at an arbitrarily worse result if doing so would fall below the specified Minimum received.
Cross-chain swaps through Omniston use a separate quoted settlement model, where the swap is based on a quote and settles on an all-or-nothing basis rather than simply accepting an arbitrarily worse execution.
𝗕𝗲𝗳𝗼𝗿𝗲 𝘆𝗼𝘂 𝗰𝗼𝗻𝗳𝗶𝗿𝗺
Don't ask only:
𝗪𝗵𝗮𝘁'𝘀 𝘁𝗵𝗲 𝘁𝗼𝗸𝗲𝗻'𝘀 𝗺𝗮𝗿𝗸𝗲𝘁 𝗽𝗿𝗶𝗰𝗲?
Also ask:
• How much am I estimated to receive?
• What is the Price Impact?
• What is my Minimum received?
• What slippage protection is applied?
• Is the available liquidity sufficient for my trade size?
The market price is a reference.
𝗧𝗵𝗲 𝗮𝗰𝘁𝘂𝗮𝗹 𝘀𝘄𝗮𝗽 𝗾𝘂𝗼𝘁𝗲 𝗮𝗻𝗱 𝗶𝘁𝘀 𝗲𝘅𝗲𝗰𝘂𝘁𝗶𝗼𝗻 𝗽𝗿𝗼𝘁𝗲𝗰𝘁𝗶𝗼𝗻𝘀 𝗮𝗿𝗲 𝘄𝗵𝗮𝘁 𝗺𝗮𝘁𝘁𝗲𝗿 𝘄𝗵𝗲𝗻 𝘆𝗼𝘂 𝗺𝗮𝗸𝗲 𝘁𝗵𝗲 𝘁𝗿𝗮𝗱𝗲.