What Is “Slippage” in Cryptocurrency Trading and How Do Iceberg Orders Attempt to Minimize It?

Slippage is the difference between the expected price of a trade and the price at which it is actually executed. In volatile crypto markets, placing a single large market order can exhaust the available liquidity at the best prices, causing the trade to be filled at progressively worse prices.

Iceberg orders attempt to minimize slippage by breaking the large order into smaller pieces. By only showing a small visible order, it interacts with the most immediate liquidity without signaling a massive demand, allowing the rest of the order to execute without causing a sharp price move against the trader.