DeFi & Yield

What is slippage in a DEX trade?

Slippage in a DEX trade is the difference between the price you expect when you submit a swap and the price you actually receive when it settles. It happens because the pool's price shifts as your trade consumes liquidity, and because other transactions can execute in between. For example, a large order in a shallow pool may fill at a noticeably worse rate than quoted. Traders set a slippage tolerance to cap how far the price can move before the swap cancels. Deeper liquidity and smaller orders relative to pool size reduce it.