What is Slippage?
Slippage is the difference between the price you're quoted and the price you actually get. It's the hidden cost of trading that most people never think about — until it costs them money.
The simple analogy
Imagine you're at a store and see a coffee listed at $4. You walk to the register, but by the time you get there, the price changed to $4.12. That 12-cent difference is slippage.
In crypto, this happens because prices move constantly. When you click "swap," the price is quoted instantly. But by the time the transaction is confirmed (2 seconds on Base, 12 seconds on Ethereum), the price may have moved.
Why slippage happens
- 01
Pool price impact
Every swap moves the price in the pool. If you swap a large amount of USDC for WETH, you're buying WETH — which increases the WETH price in that pool. The bigger your trade relative to the pool's liquidity, the more the price moves against you.
- 02
Price movement during confirmation
Between when you sign the swap and when it's confirmed, market prices can change. On Base this window is ~2 seconds; on Ethereum it's ~12 seconds. More time = more potential movement.
- 03
MEV extraction
On unprotected platforms, MEV bots can see your pending transaction and front-run it — buying before you and selling after, which worsens your price. Orkid prevents this with private execution.
How Orkid handles slippage
Most platforms let you set a fixed slippage tolerance (e.g., 0.5%). If the price moves beyond that, the swap reverts. But a fixed tolerance is either too loose (you overpay) or too tight (your swap reverts and you get nothing).
Orkid uses adaptive slippage — the tolerance is calculated dynamically based on:
- Hop count: More hops = more pools = more price movement risk
- Split count: Split routes across multiple pools need tighter coordination
- Pool staleness: How recently the pool data was refreshed
The result: slippage tolerance ranges from 0.01 bps (for simple single-hop routes with fresh data) to 1.25 bps (for complex multi-hop routes with older pool data). This is far tighter than the typical 50 bps most platforms default to.
FAQ
What does "bps" mean?
Bps stands for "basis points." 1 bps = 0.01%. So 50 bps = 0.5%, and 9 bps = 0.09%. It's the standard unit for measuring fees and slippage in finance.
What happens if slippage exceeds the tolerance?
The swap reverts automatically. You keep your original tokens — no loss, no partial fill. You can try again when the market is calmer.
Can I set my own slippage on Orkid?
Orkid's adaptive slippage is automatic. The solver calculates the optimal tolerance for each route. This prevents both overpaying (loose tolerance) and failed swaps (tight tolerance).
Is slippage the same as the Orkid fee?
No. The Orkid fee is 9 bps — a fixed charge for using the service. Slippage is the market price movement during execution. They're separate costs. Orkid's adaptive slippage minimizes the second one.