What is Slippage and How to Adjust Slippage on Pintu Web3

What is Slippage?

Slippage refers to the difference between the real-time displayed price and the actual price received when making a purchase. In the context of Web3, slippage can occur due to various factors, such as insufficient liquidity for specific asset pairs, high cryptocurrency price volatility, and impermanent loss experienced by liquidity providers in mechanisms like automated market makers (AMMs).

It is crucial for traders and liquidity providers in the Web3 ecosystem to understand the concept of slippage and take proactive steps to minimize its impact.

How to Adjust Slippage on Pintu Web3

In addition to slippage, there is a term called slippage tolerance, which refers to the acceptable level of price difference (slippage) an investor is willing to tolerate. Slippage tolerance is typically set as a percentage of the total swap value.

In Pintu Web3, there are two types of slippage tolerance settings: auto slippage and manual slippage, depending on the network you use—either Ethereum (EVM) or Solana.

Auto slippage is an automated mechanism that adjusts the slippage tolerance during transactions without requiring trader intervention. This ensures that orders can still be executed even if prices fluctuate within the defined limits. Currently, Auto Slippage on Pintu Web3 is only available on Solana network.

Manual slippage, on the other hand, allows traders to manually set their slippage tolerance before executing a transaction. This setting gives traders full control over how much price difference they are willing to accept in volatile market conditions.

Simulation of Auto Slippage and Manual Slippage:

• Auto Slippage: If slippage tolerance is set at 3%, the system will automatically seek the minimum slippage within the maximum limit of 3%. This means the applied slippage could be lower, depending on market conditions.
• Manual Slippage: If slippage tolerance is set at 3%, that exact percentage is applied directly to the blockchain without adjustment. The system does not adapt to market conditions.

In conclusion, auto slippage offers flexibility by adjusting to market conditions, while manual slippage provides users with complete control over their settings.

How to Use Auto Slippage on Pintu Web3

Here is an example of how the auto slippage setting is used on Pintu Web3:

• Open the main page of Pintu Web3 Wallet and click on the “Swap” menu.

• Select the network and token you wish to swap, for example, Solana. Then, enter the amount of assets you want to exchange.

• You can check the slippage settings by tapping the slippage settings section located at the top right corner of the Swap page, then select the “Auto” tab.

• Make sure to select or tap Auto in the Slippage Tolerance section. With the auto option, the maximum slippage is set at 3%, meaning the transaction will not be processed if the price difference exceeds this value. Then, click the “Save” tab to proceed.
• After that, double-check all your settings and click “Confirm” as the final step.

How to Use Manual Slippage on Pintu Web3

Here is an example of how the manual slippage setting is used on Pintu Web3:

• Open the main page of Pintu Web3 Wallet and click on the “Swap” menu.
• Select the network and token you want to swap, for example, Ethereum. Then, enter the amount of assets you want to exchange.

• To adjust the slippage settings according to your preferences, click on the slippage settings located in the top right corner of the Swap page.

• You can adjust the maximum slippage tolerance value by using the “-” or “+” buttons, or you can directly type the desired number to decrease or increase the tolerance percentage as needed. In the example image above, the slippage tolerance is set to 0.3%, which means if the market price changes and exceeds this limit, the transaction will not be processed. Then, click the “Save” tab.
• After that, double-check all your settings and click “Confirm” as the final step.