Slippage
The difference between the expected price of a trade and the price you actually get when the trade executes. Slippage usually goes against the trader and gets worse with bigger trades or thinner markets.
Also known as: price slippage, execution slippage
Slippage is the gap between what you thought a trade would cost and what it actually cost. On a centralised exchange with a deep order book, slippage is usually small (a fraction of a percent for reasonable trade sizes) because there are many buy and sell orders queued up at every price level. On a thin market or a small AMM pool, slippage can be enormous: a $10K trade might execute at a 5-10% worse price than the quoted spot price because there isn’t enough liquidity at any single price level to fill the order without consuming several layers of orders.
The mathematical reason slippage exists comes from how AMMs and order books work. AMMs use a pricing curve (constant product, constant sum, or more sophisticated variants) where the price quoted for the next unit of token depends on how much is currently in the pool. As you buy, the pool composition changes, and the next unit costs slightly more than the previous one. The total cost of a large trade is the integral of the curve, not just the spot price times the quantity. The bigger the trade relative to pool size, the more this curve effect matters.
Order books behave differently but the principle is the same. Each price level has a fixed amount of liquidity available. A market buy order eats through the cheapest sell offers first, then the next cheapest, and so on until the order is filled. If the order is large relative to the depth at the current price, you walk the book, paying progressively more for each successive chunk. The “effective” price for the whole order is the volume-weighted average of all the levels you consumed.
The practical defence against slippage is twofold: trade smaller sizes (slippage scales nonlinearly with order size) and use protocols that aggregate liquidity across many sources (1inch, Jupiter, Matcha route trades through multiple pools simultaneously to minimise the impact on any single one). For DeAI tokens specifically, slippage is usually fine on tier-1 CEXes (Binance, Coinbase) and gets ugly on smaller DEXes for projects with thin liquidity. The OYM Liquidity and Access dimension factors slippage exposure into the score.