How Is Slippage Calculated in a High-Volatility Cryptocurrency Trade?

Slippage is the difference between the expected price of a trade and the actual execution price. In high-volatility crypto trades, it is calculated as the absolute difference between the mid-price at the time the order was submitted and the final average execution price.

High volatility causes rapid price changes and wider spreads, increasing the likelihood of an order being filled at a less favorable price, thus increasing slippage.