What is Slippage Tolerance?
This articles explain the detail on slippage tolerance and how to avoid being stuck with error when making a transactions.
The definition of a Slippage refers to the difference between the expected price of a trade and the price at which the trade is executed. Slippage can occur at any time but is most prevalent during periods of higher volatility when market orders are used.
When cryptocurrency traders want to trade in Decentralize Exchange, they have to set their price slippage in making a swapping transaction in order for their buying or selling get executed due to DEX is an AMM platform. By increasing the slippage in DEX platform it will make the traders to spend a lot of cost in order to get the token they intend to hold. Normal slippage sometimes cost only 0.5% but if the traffic of transactions increase the tolerance of slippage also will increase.
In any case, if traders get their swapping transactions stuck with ‘error’ in DEX, it is the reason that they set a low slippage rate. By increasing the slippage, it will make the transactions executed but the traders will not get their expected amount.
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