What is slippage in crypto?
Slippage is the gap between the price you were quoted and the price you got. Here is what causes it, how tolerance settings work, and when you pay none at all.
Slippage is the difference between the price you were quoted and the price your trade actually executed at. You ask for a swap at one number, the trade settles at another, and the gap between them is slippage.
It exists because a quote is a photograph of a market that keeps moving. Between the moment you read the screen and the moment the network confirms your trade, other people traded too. On a busy network that gap is a few seconds. A few seconds is enough.
This is the most common reason a first swap ends with less than expected, and it is also the one that is easiest to control once you know which of its two causes you are looking at.
What causes slippage?
Two different things widen the gap, and telling them apart is most of the answer.
Other people's trades. Your quote was true when it was calculated. Then somebody else's order hit the same market before yours confirmed, the price moved, and yours executed against the new one. Nobody can predict this, including the platform quoting you. This is slippage in the strict sense.
Your own order size. On a decentralised exchange you trade against a pool of two tokens, and every unit you take out makes the next one cost more. A large order walks up its own price as it fills. This is price impact, it is computable from public data before you trade, and it is not slippage even though the two words get used as one. How an AMM prices a trade works through the arithmetic with numbers.
The practical difference: price impact is yours and knowable in advance, slippage is everyone else's and knowable only afterwards. A tolerance setting caps the second one. Nothing caps the first except trading smaller or trading somewhere deeper.
Two conditions make both worse: thin liquidity, meaning there is not much on the other side to trade against, and volatility, meaning the price is moving fast anyway. A quiet pair on a deep market barely slips at all.
Can slippage work in your favour?
Yes, and it is worth knowing because it tells you slippage is not a fee.
Positive slippage is when the price moves your way between quote and execution, and you receive more than you were shown. Negative slippage is the opposite, and it is the one everybody notices. Neither is charged by anyone. Both are the market being a different size when your order lands than when it was quoted.
That is the honest framing: slippage is exposure to time, not a cost somebody collects. A fee is a cost somebody collects, and the two should be read separately on any receipt.
What is slippage tolerance?
Slippage tolerance is a limit you set before a trade on a decentralised exchange: the worst price you are willing to accept. If the market moves further than that before your transaction confirms, the trade fails instead of filling at a price you did not agree to.
It is a trade-off in both directions, which is why there is no single right number.
Set it too low and ordinary market movement cancels your trade. On most networks a failed transaction still costs the network fee, so you pay for nothing and have to try again.
Set it too high and you have told the network you will accept almost any price. On a public blockchain, where pending transactions are visible before they confirm, that is an invitation: a bot can trade just ahead of you, sell into your order at the worse price you agreed to, and pocket the difference. This is called a sandwich attack, and a generous tolerance is what makes it profitable.
The usual approach is to start low, raise it only if the trade keeps failing, and treat a pair that needs a very high tolerance as a signal about that pair's liquidity rather than a setting to fix.
How is slippage different on a centralised platform?
It depends on what the platform promises, and the promise is the thing to read.
On a decentralised exchange, you sign a transaction and wait for the network. The gap between signing and confirming is where slippage lives, which is why the tolerance setting exists there and nowhere else.
On a centralised exchange with an order book, a market order fills against whatever offers are posted. Deep books absorb ordinary orders with almost no movement; a large order in a thin book still walks the book the way it would walk a pool.
On a platform that settles internally, you are shown a final amount and the platform commits to it for a short window. There is no network wait for you to be exposed to, so there is nothing for a tolerance setting to do.
Does Inkryptus have slippage?
Not for you, on an internal swap, and the mechanism is worth stating plainly rather than as a slogan.
An Inkryptus swap shows you a final amount before you confirm, and that amount is what arrives. The quote holds for a short validity window, and if the market moves past it the app asks for a fresh quote instead of filling at the old number. The platform carries the movement inside that window, not the user. There is no tolerance setting in the app because there is nothing for you to set.
What you do pay is a flat 3 USDT per operation, charged in the coin you send, and it is shown on the same screen as the amount. That is a fee, and it is the only deduction between the two numbers.
The check is the receipt. The confirmation screen states the final amount to receive, and the completion screen states what you received. Those two numbers are the pair that should match, and they are the ones to compare rather than the price above them.
One boundary, because it is a real one: this covers swaps that settle inside the platform. Moving crypto out to another wallet is an on-chain transaction and carries the network's own costs and conditions, which is a different subject to how a swap works.
How do you reduce slippage?
Five things actually move the number, in rough order of how much they help.
Trade against depth. The same order costs less in a deeper pool. Pool depth is public on any DEX analytics site, and checking it before a large order is faster than regretting it after.
Split a large order. Several smaller trades over time pay less than one order that walks the whole curve at once.
Prefer a liquid pair. Routing through a widely traded asset such as USDT usually costs less than a direct route between two thin ones, even counting the extra step.
Avoid the most volatile minutes. Right after a listing or a major announcement, quotes and executions are furthest apart.
Read the amount, not the price. The quantity shown before you confirm already includes the walk. The price above it is an estimate at an instant, useful for comparing markets and not a promise about your order.
Frequently asked questions
Is slippage a fee?
No. A fee is an amount somebody charges and keeps, and it is stated before you confirm. Slippage is the market moving between your quote and your execution, it can go either way, and nobody collects it. On a receipt they should be read as two separate lines.
What is a normal slippage tolerance?
There is no universal number, because it depends on the pair's liquidity and how fast the market is moving. The practical method is to start low, raise it only if trades keep failing, and treat a pair that needs a very high tolerance as information about that pair rather than a setting to work around.
Why did I receive less than the quote even with no slippage tolerance triggered?
Most often that is price impact rather than slippage: your own order moved the price as it filled, which the quoted price never included. It is computable in advance from the pool's balances, and the amount shown at confirmation already accounts for it.
Can slippage be positive?
Yes. If the price moves in your favour between quote and execution, you receive more than you were shown. It is less discussed than the negative kind for the obvious reason, but it is the same mechanism running the other way.
What is a sandwich attack?
On a public blockchain, pending transactions are visible before they confirm. If your slippage tolerance is set generously, a bot can place an order just before yours, let yours execute at the worse price you already agreed to accept, and close its position immediately after. A tighter tolerance removes most of the incentive.
Does slippage apply to staking or transfers?
No. Slippage is specific to trading one asset for another at a moving price. Staking and a transfer between two accounts do not exchange one asset for another, so there is no price to move between quote and execution.
Keep learning
How an AMM prices a trade | What is a crypto swap | What is USDT | How to check your crypto on-chain
Crypto asset investments involve risks, including price volatility and risk of partial or total loss of the invested amount. Digital tokens are not legal tender. This content is informational and does not constitute investment advice.