What is Slippage in Crypto Trading?
The hidden cost that can eat into your profits more than trading fees. Learn how to minimize slippage and protect your trades.
Important: Slippage can often cost more than trading fees, especially for large orders or during volatile markets. Our fee calculator includes estimated slippage to give you the true cost of trades.
What is Slippage?
Slippage is the difference between the expected price of a trade and the actual price at which it executes. When you place a market order, you might expect to buy Bitcoin at $50,000, but due to slippage, your average fill price might be $50,025 or higher.
While a 0.05% difference might seem negligible, it adds up quickly for active traders and can significantly impact profitability over time.
Why Does Slippage Happen?
Slippage occurs due to several factors:
1. Order Book Depth
When your order is larger than the available liquidity at the best price, it "eats through" the order book, filling at progressively worse prices.
2. Market Volatility
In fast-moving markets, prices change between when you submit an order and when it executes, especially on exchanges with slower matching engines.
3. Low Liquidity
Trading pairs with low volume have wider spreads and thinner order books, leading to higher slippage for any order size.
4. Large Order Size
Bigger orders have more price impact. A $100 order might have 0.01% slippage, while a $100,000 order might experience 0.1% or more.
Slippage Example
Let's say you want to buy $10,000 worth of Bitcoin at market price:
Order Book State:
Your $10,000 market buy fills:
Slippage Across Different Exchanges
Different exchanges have vastly different liquidity levels, which directly affects slippage:
How to Minimize Slippage
1. Use Limit Orders
Limit orders execute at your specified price or better, eliminating slippage entirely. The trade-off is that your order might not fill immediately.
2. Trade on High-Liquidity Exchanges
Binance, Bybit, and OKX have the deepest order books, resulting in minimal slippage even for large orders.
3. Split Large Orders
Instead of one $100,000 order, execute ten $10,000 orders over time (TWAP - Time Weighted Average Price) to reduce market impact.
4. Avoid Trading During Volatility
Slippage increases dramatically during news events, liquidation cascades, and market opens/closes.
5. Trade Major Pairs
BTC/USDT and ETH/USDT have much better liquidity than obscure altcoin pairs, resulting in lower slippage.
Slippage vs Trading Fees: Which Matters More?
For small orders on liquid exchanges, trading fees typically exceed slippage costs. However, for large orders or illiquid markets, slippage can dwarf fee costs:
$1,000 Order on BTC/USDT
$100,000 Order on Altcoin
This is why our fee calculator includes slippage estimates - to give you the complete picture of your trading costs.
Calculate Your True Trading Costs
Our calculator includes both fees AND estimated slippage based on exchange liquidity.
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