# Slippage

Slippage refers to the difference between the expected price of a trade when an order is placed and the actual price at which it is executed, caused by market fluctuations during transaction processing.

## Moonshot's role <a href="#h_873ddd947e" id="h_873ddd947e"></a>

Moonshot is not an exchange; it’s a self-custody blockchain wallet that lets you interact with decentralized exchanges (DEXs) on the blockchain through Jupiter Aggregator, a smart contract that routes through several DEXs for better pricing. Instead of using traditional order books, these platforms rely on automated market makers (AMMs) and liquidity pools to process trades.

For a better understanding of decentralized exchanges and automated market makers, check out[DEXs](/trade/dexs.md).

## Example <a href="#h_349119e38e" id="h_349119e38e"></a>

By default, Moonshot applies a dynamic slippage tolerance of up to 10% to accommodate market volatility. For example, if you’re purchasing $100 worth of a coin, you may receive coins valued between $90 and $110, depending on market conditions at the time of execution.

## Adjusting slippage <a href="#h_3905c5a396" id="h_3905c5a396"></a>

You can modify the slippage tolerance from 0.5% to 20% by clicking the settings icon in the buy/sell modal.

<figure><img src="https://downloads.intercomcdn.com/i/o/flia4w7b/1386123784/2369c3f1e4a19b4a95304de4db9a/IMG_5653.jpg?expires=1745280000&#x26;signature=1865833cb6152f06837afdb02af1c318358f96676b3f0b217d5532313a0013b1&#x26;req=dSMvEMh8noZXXfMW1HO4zaVCbm%2Bfg0iR0xx6TZCsrNxGvNjLRu9qAIPrhED5%0AFA3diH%2BcrbMmXAX8oTw%3D%0A" alt=""><figcaption></figcaption></figure>

{% hint style="info" %}
Change these settings at your own risk; you are responsible for your transactions.
{% endhint %}

## Slippage vs. price impact <a href="#h_8bfdbdabbe" id="h_8bfdbdabbe"></a>

Price Impact refers to how your trade affects the market price, particularly for large orders relative to the coin’s liquidity. Placing a significant order can consume a substantial portion of the available liquidity, potentially pushing the price up or down, which may result in you paying more or receiving less than the price displayed when you place your order.

### Example of price impact <a href="#h_1149baa7e5" id="h_1149baa7e5"></a>

Placing a large buy order in a low liquidity market can increase the coin’s price as you compete for a limited supply. Similarly, a large sell order can decrease the price due to increased supply.

### Reducing price impact <a href="#h_0e6ff61a99" id="h_0e6ff61a99"></a>

To minimize price impact on a large position, people often split their trade into smaller transactions. This can help distribute the effect over time or across different price points, reducing market movement caused by your order.

## Summary: <a href="#h_378852c50b" id="h_378852c50b"></a>

1. Slippage affects all traders, but is more noticeable in volatile markets or with low-liquidity coins.
2. Price impact typically only affects very large trades in relation to market liquidity.
3. High slippage tolerance increases the likelihood of execution but may result in a worse price.
4. Low slippage tolerance can cause failed transactions.
5. During periods of high volatility, you may need to increase your slippage tolerance to ensure your transaction is processed successfully.


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