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Results for “Slippage tolerance vs Price impact”
Slippage tolerance
Slippage tolerance is a setting on a decentralized exchange swap that says how far the final price may move against you, as a percentage, before the trade is cancelled. If the price moves more than that before the transaction is processed, the swap fails instead of executing.
What it means for you. Set high, slippage tolerance lets bots sandwich your swap and fill you at the worst price you allowed. Set too low, swaps fail in busy or thin markets, and on many chains a failed transaction still costs a network fee. The tolerance is the most you agree to lose to price movement, not an estimate of what you will lose.
Source: Zhou, Qin, Ferreira Torres, Le and Gervais: High-Frequency Trading on Decentralized On-Chain Exchanges (arXiv) · checked 4 October 2026
Price impact
Price impact is how much your own trade moves the price. On an automated market maker, each unit you buy or sell shifts the pool's balance, so a larger trade gets a worse average price. The more liquidity a pool has, the smaller the impact of a given trade.
What it means for you. Price impact is a cost you cause, separate from fees and from slippage. A high figure on a swap screen means you would sell a meaningful share of the pool and receive much less than the quoted price. Splitting the amount does not remove it if the pool stays thin.
Sources: Uniswap docs: Swaps, Uniswap docs: How Uniswap works · checked 4 October 2026