You have 100,000 USDC and want to buy ETH. Common habit is you go directly to DEX, enter the amount, and click Swap. As a result, you receive less ETH than the market rate. You just lost a few hundred dollars due to Slippage and Price Impact. Why? Because you tried to force a large order into a single Liquidity Pool with limited depth.
๐ธ What Is A DEX Aggregator?
Imagine a DEX Aggregator as Skyscanner of crypto.
Skyscanner does not sell tickets. It scans data from airlines to find you the cheapest flight.
Similarly, a DEX Aggregator does not hold liquidity. It scans data from all DEXs to find you the best rate.
๐ธ When you sell 100,000 USDC via an Aggregator, it does not dump it all in one place. It executes two smart algorithms:
It splits your order and sells it on different DEXs ๐ Reduce pressure on individual pools ๐ Lower slippage.
It finds detours if they are cheaper.
๐น Individual DEXs are where liquidity is Provided. Aggregators are where liquidity is Consumed. As a trader, always trade on Aggregators to ensure you get Best Execution.
Are you using a search engine to find cheap tickets, or just walking into the airport to buy overpriced ones?
News is for reference, not investment advice. Please read carefully before making a decision.
