What is Slippage? — Why You Can't Buy at the Displayed Price

In One Sentence

Slippage is the difference between the "expected price" you were looking at and the "actual price" at which your trade is executed. It is a cost separate from trading fees.

Why It Happens

The price displayed on an exchange screen is simply the very last price that was traded. It is not necessarily the price at which you can buy right now.

Your actual order is matched against other users' orders waiting in the order book (a list of buy and sell orders). You buy starting from the cheapest available sell order. If your order size is large, you will consume all the cheap shares and end up buying the next, more expensive ones. The average of these transactions becomes your actual execution price.

• Highly active coins → Thick order book → Even large orders execute very close to the displayed price
• Low-volume coins → Thin order book → Even small orders can cause the price to jump significantly

We Measure It Ourselves

As of 24 Aug, here is what we measured when buying bitcoin on Binance — a $100 order filled at $77,244 on average (0% slippage), and even a $100,000 order slipped only 0%. On heavily traded coins like bitcoin, even large orders fill at the price you see. The problem is the unfamiliar names — the same $100,000 order can slip several %, or the book may run out before it fills.

Every 10 minutes, Antprofit calculates the average execution price assuming you place orders of $100, $1,000, $10,000, and $100,000 for each coin based on the exchange's order book. This number is not shown on standard price charts, and this is the only place where you can find out "how much it actually costs to buy this coin."

If the order book cannot absorb that specific amount, it will be displayed as "Insufficient Liquidity." If you force a large market order (an order executed immediately at the best available price) into such a coin, the price will spike dramatically.

What Beginners Should Do

1. Check the order book depth before buying unfamiliar coins. Even if a coin has a high overall trading volume, its order book can still be thin on certain exchanges.
2. Split large orders into smaller pieces. If you push a large amount all at once, you will drive up the price against yourself.
3. Use limit orders if you are not in a hurry. Limit orders (where you set a specific price to buy or sell) do not suffer from slippage, though there is a chance your order might not get filled.
4. The same applies when selling. Some coins are even more disadvantageous to sell than to buy — this means there are very few people willing to buy them.