Price Impact
The effect a trade has on the pool price, larger for bigger trades.
The effect a trade has on the pool price, larger for bigger trades.
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Sep 2026 · Показник свіжості: 50%
Що таке Price Impact?
The effect a trade has on the pool price, larger for bigger trades.
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In an AMM, a trade moves the pool's ratio along the bonding curve, so the marginal price worsens with size. Price impact = the difference between the expected price and the executed average price. It compounds with fees and slippage. Aggreg
Price impact is the main cost of large trades on DEXs — it determines whether a trade is economical and influences where liquidity flows. Understanding it helps traders size orders and choose venues; minimizing it is the core value of aggre
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1. What Is Price Impact
Price impact is the change in the execution price of a trade caused by the trade itself — the larger the trade relative to liquidity, the worse the price. It is a core cost of trading, especially in AMMs.
2. How It Works
In an AMM, a trade moves the pool's ratio along the bonding curve, so the marginal price worsens with size. Price impact = the difference between the expected price and the executed average price. It compounds with fees and slippage. Aggregators split orders across pools to minimize impact.
3. Why It Matters
Price impact is the main cost of large trades on DEXs — it determines whether a trade is economical and influences where liquidity flows. Understanding it helps traders size orders and choose venues; minimizing it is the core value of aggregators.
4. Key Facts
- Price impact scales with trade size relative to pool depth
- Deep liquidity pools have lower impact
- Aggregators route to minimize combined impact + fees
- On-chain simulators preview impact before executing
5. Related Concepts
- decentralized-exchange
- liquidity-incentive
- aggregation-protocol
- swap-fee
Frequently Asked Questions
What is Price Impact?
The effect a trade has on the pool price, larger for bigger trades.
How does Price Impact work?
Price impact is the change in the execution price of a trade caused by the trade itself — the larger the trade relative to liquidity, the worse the price. It is a core cost of trading, especially in AMMs. In an AMM, a trade moves the pool's ratio along the bonding curve, so the marginal price worse
Why does Price Impact matter in Web3?
- liquidity-incentive - aggregation-protocol - swap-fee