When the chain is converted, the price quoted by the user does not always match the final offer. The difference is the slide point. It is not a separate fee charged by the platform, but in frequent transactions, the actual costs may be higher than the intuitive fees of many.
The slide points have changed in nature.
The slide point refers to the difference between the expected price at the time of the next order and the performance price at the time the transaction is actually completed. The market is not static. Liquidity and prices may change during this period, from user click confirmation to transaction packaged and settled.
If the market moves in a negative direction, the purchase price will be higher and the selling price will be lower; if the market moves in a favourable direction, there may also be a “positive slide point”, that is, the actual deal is better than the initial offer. In other words, the slide point is essentially price uncertainty rather than fixed rates.
Both sources are the most critical.
The slide points usually come from two factors: liquidity and volatility.
Liquidity determines the number of available assets close to current prices. Mainstream assets such as BTC, ETH are more mobile on most platforms, and orders of average size have less impact on prices. On the contrary, small market value tokens, new online tokens or cold-door trades are often limited in size and depth, with a slightly larger order likely to eat up to near liquidity, and the price of the deal becomes worse.
The volatility reflects how fast the price itself changes. Even if the market depth is sufficient, if the asset fluctuates quickly in a short period of time, the offer that the user saw a few seconds ago may have lapsed at the time the transaction was confirmed. This is particularly true when the encrypted market is news-driven, social media-led or low-mobility.
These two factors may also occur at the same time. Small currencies often lack liquidity and are more prone to sharp fluctuations, making them more likely to have visible slide points. The larger the orders, the more evident they are.
Don't confuse the other two.
In particular, the article distinguishes between slide points, price effects and trade price differentials.
Price effects are part of the order itself that drives changes in market prices. In DEX, for example, a large purchase would consume the market ' s mobility in the pool, leading to a move in the pool price; a large purchase order would press down the price. This cost can normally be estimated before the transaction, as it depends on the size of the order and the depth of the pool.
The slide point favours the additional deviation during the transaction execution. It comes from the period between the submission of the order and the conclusion of the transaction, when other transactions enter first, or when the market price changes itself. In short, the price effect is “what your order creates” and the slide point is “what happens to the market before you close”.
Price differentials are the third independent cost. In the order book market, there is an inherent difference between the highest purchase price and the lowest selling price. As long as the price difference is negotiated, the user has already borne part of the cost, which is not the same as the slide point.
Common practices to lower slide points
- Prioritize more liquid markets and transactions
- Large-value exchange to avoid rapid price fluctuations
- Set a reasonable slide tolerance based on the size of the transaction
If supported by the platform, the price limit list could also help users to reduce unnecessary price deviations. For swap users on the chain, the slide point setting is not as high as possible. Tolerating highs, although easier to settle, may also allow transactions to be completed at even lower prices, magnifying actual costs.
For users who exchange regularly on the chain, the slide point is more appropriately considered a transaction cost that needs to be observed separately. It may not be as straightforward as a fee, but it will continue to affect the final outcome.