Why does price slippage occur more frequently in low-liquidity pools?
Price slippage occurs more frequently in low-liquidity pools because these pools have fewer tokens available. When a trade is made in a low-liquidity pool, even small transactions can significantly affect token prices due to the limited supply. This makes the final price of a trade more likely to differ from the quoted price, resulting in slippage. To avoid this, it’s recommended to trade in pools with higher liquidity, where the impact of individual trades is less pronounced.