Slippage vs price impact: two reasons your quote can change

The idea in plain English

Price impact is the effect your trade has on the available market or pool. Slippage is the difference between the expected execution and what actually occurs, which can include market movement and timing. Interfaces may define and display these measures differently, so read the venue’s own explanation.

The distinction that matters

A slippage tolerance is a boundary for acceptable execution, not a promise of an exact result or protection from a bad asset. Increasing it can allow a transaction to complete under worse conditions. Reducing it can cause failure and may still leave a network charge, depending on the chain and transaction.

A practical example

A fictional quote suggests receiving 100 units. With a 1% output tolerance and no other complications, a minimum might be 99 units. That arithmetic says nothing about whether the token is genuine or whether 99 units is a fair economic price.

Try this without moving money

• Calculate expected and minimum output for an invented quote.
• Explain whether a change comes from order size or market movement.
• Check how the interface treats failed transactions and network charges.

A mistake to avoid

Do not keep raising tolerance just to force a trade through. A warning may be useful evidence that the route is unsuitable.

Before you act

An audit, popular interface or large deposited balance is not an insurance policy. Contracts may depend on administrator keys, price feeds, bridges and outside issuers. Understand withdrawals and liquidation before experimenting. Learning does not require depositing funds, granting approvals or using leverage, and this guide does not recommend a protocol.