Close Menu
Crypto Chain Post
    Trending

    Polymarket to Serve as Official Prediction Market of Elon Musk’s X

    June 7, 2025

    XRP Wave Structure Predicts Wild Fluctuations On Its Way To $4 ATH

    June 7, 2025

    Mass data deletion by governments is accelerating.

    June 7, 2025

    Former Ripple Exec Follows Michael Saylor’s Bitcoin Playbook

    June 7, 2025

    Ripple USD (RLUSD) Volume Down 57%, Bigger Threat to XRP?

    June 7, 2025
    Facebook X (Twitter) Instagram TikTok Telegram
    • Privacy Policy
    • Terms of use
    • Advertise
    • Contact
    Saturday, June 7
    Crypto Chain Post
    Price Index Newsletter
    • Home
    • News
      • Bitcoin
      • Ethereum
      • Altcoin
    • Blockchain
    • Markets
    • NFTs
    • DeFi
    • Web3
    • Analysis
    • Metaverse
    • Resources
      • Price Index
      • Crypto Heatmap
      • Glossary
      • Exchange
      • Economic Calendar
    • More
      • GameFi
      • ICO
      • Legal
      • Security
    Crypto Chain Post
    Home » Price Impact

    Price Impact

    News RoomBy News RoomDecember 30, 2022No Comments2 Mins Read

    The difference between market price and estimated price due to trade size.

    Price impact is an expression used to describe the correlation between an incoming order and the change in the price of the asset involved caused by the trade.

    Buy trades push the price of a given asset higher by exhausting the cheapest sell orders in the order book, while the opposite happens for selling trades. The extent to which the price moves as a result of trades largely depends on the liquidity of the trading pair affected. More liquid trading pairs will see a smaller price impact than those with lower trading volumes.

    Traders — especially those trading on markets with limited liquidity or those who make big trades — have to keep in mind the impact of their trade on the asset price. Their second buy trade will on average be more expensive than the first one because of their impact on the market.

    Monitoring and controlling price impact is one of the hottest areas of interest in research conducted by trading firms. Much effort is currently being dedicated to understanding how dependent the trade impact is on the trade size and how long it takes for its effect on asset price to manifest fully.

    Back to Glossary Index Page

    Share. Facebook Twitter Pinterest LinkedIn Tumblr Email
    Add A Comment
    Leave A Reply Cancel Reply

    Top News

    XRP Wave Structure Predicts Wild Fluctuations On Its Way To $4 ATH

    June 7, 2025

    Mass data deletion by governments is accelerating.

    June 7, 2025

    Former Ripple Exec Follows Michael Saylor’s Bitcoin Playbook

    June 7, 2025
    Advertisement
    Demo
    Crypto Chain Post
    • Home
    • Privacy Policy
    • Terms of use
    • Advertise
    • Contact
    © 2025 Crypto Chain Post. All Rights Reserved.

    71-75 Shelton Street, Covent Garden, London United Kingdom, WC2H 9JQ

    Type above and press Enter to search. Press Esc to cancel.