Can you explain the concept of bid-ask slippage and its impact on cryptocurrency trading?

1 answers

• Disha SoodJan 25, 2023 · 3 years ago
  Bid-ask slippage is a common phenomenon in cryptocurrency trading. It occurs when there is a difference between the price at which you want to buy or sell a cryptocurrency and the actual executed price. This difference can be caused by various factors such as market volatility, liquidity, and order size. For example, if you want to buy a cryptocurrency at a certain price, but there are not enough sellers at that price, you may end up paying a higher price to get your order filled. Similarly, if you want to sell a cryptocurrency at a certain price, but there are not enough buyers at that price, you may end up selling at a lower price than expected. Bid-ask slippage can impact your trading by reducing your profitability and increasing the cost of your trades. It is important to be aware of bid-ask slippage and consider it when placing orders to minimize its impact on your trading results.
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