What does slippage tolerance mean? How do I set slippage in Uniswap and Pancakeswap? Is there max slippage? Slippage tolerance is a more important concept, especially for those new to crypto and those trading in altcoins.
Slippage
Slippage refers to the difference between the expected price of a trade and the price at which the trade is executed. This can occur in all markets, like forex and stocks.
It is more frequent, in crypto markets. Especially on DEX (decentralized exchanges) like Uniswap, Pancakeswap due to the high levels of price volatility. Because common problems experienced by altcoins, such as low volume and liquidity, can also contribute to the slippage.
Slippage Tolerance in Crypto
Slippage tolerance is an important term that you need to understand before executing a trade on DEX. Slippage is a general term that you would encounter when using a platform like Pancakeswap, Uniswap, or similar platforms.
When trading crypto, the volatility in asset price can create such a situation where the executed price is different from the quoted and expected price. Slippage is the expected % difference between these intended and executed prices.
Slippage can quickly become a frustratingly slippery slope for the less experienced trader, so it’s important to understand the volatility of cryptocurrency.
You may interested: Liquidity Problem in New Coin / Tokens at That Make Presale (IDO)
How Can I increase my slippage tolerance?
There are small changes depending on the platforms you use. You can change the rate as you wish. Below you can find how to change the slippage tolerance for Uniswap and Pancakeswap.
Max Slippage Tolerance
There isn’t max slippage tolerance. You can set the rate you want.
To Adjust Slippage Tolerance at UniSwap
Uniswap default slippage tolerance 0,5% To adjust your slippage tolerance, click on the gear icon located at the top right-hand corner on the Uniswap browser.
There you can adjust your slippage tolerance. You can choose “Auto” option or adjust it manuel.
To Adjust Slippage Tolerance at PancakeSwap
Pancakeswap default slippage tolerance between 0,5%-1% To adjust your slippage tolerance, click on the Settings icon located at the top right-hand corner on the Pancakeswap browser.
There you can adjust your slippage tolerance.
You need to research the coin you will trade well. If the coin has imposed a certain amount of transaction fee, you sho nt.
Example: If a coin has set the transaction fee as 10%, you must adjust the slippage rate higher than 10%.
A Tip: There is “Auto Slippage” feature in Poocoin Swap, you can use it. Poocoin Swap
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