Price Impact

Definition ∞ Price impact is the change in an asset’s market price caused by a specific trade. This phenomenon occurs when a large buy or sell order significantly alters the prevailing market price due to insufficient liquidity at various price levels. In markets with low liquidity, even moderately sized trades can cause substantial price movements, leading to less favorable execution prices for the trader. Understanding price impact is crucial for executing large orders efficiently and minimizing trading costs.
Context ∞ News reports often analyze price impact in relation to market liquidity, especially when discussing the execution of large institutional trades or the performance of smaller altcoins. High price impact can deter large investors and indicate market inefficiency or susceptibility to manipulation. Decentralized finance protocols continuously work to reduce price impact through deeper liquidity pools and improved automated market maker designs.

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→Altcoin Market

→Deleveraging

→Futures Markets

Crypto Market Dips as Liquidations and ETF Outflows Drive Prices Down

The cryptocurrency market experienced a notable downturn, driven by over a quarter-billion dollars in liquidations and significant withdrawals from Bitcoin spot ETFs.

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→Tokenomics Flaw

→On-Chain Forensics

→Short Positions

River Protocol Token Suffers Coordinated Market Manipulation Attack

Attackers exploited low token liquidity and a points-to-token conversion mechanism to trigger a sharp price decline and profit from short positions.

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→Market Volatility

→Futures Contracts

→Trading Strategies

Massive Crypto Options Expiry Looms over Market Stability

A colossal $22 billion in Bitcoin and Ethereum options is set to expire, creating potential for significant market volatility and strategic shifts.

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→Stablecoins

→Multi-Signature Vulnerability

→Digital Asset Security

UXLINK Multi-Signature Wallet Compromised, Billions of Tokens Minted

A delegate call vulnerability in UXLINK's multi-signature wallet granted administrative control, enabling unauthorized token minting and significant financial loss.

→Digital Collectibles

→Market Downturn

→Ethereum Price

NFT Market Plunges 12% as Ethereum Price Drops

The NFT market experienced a significant downturn, with its total value falling 12% following a 9% dip in Ethereum's price.

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→Altcoin Event

→Market Dynamics

→Crypto Supply

Major Token Unlocks Loom, Increasing Crypto Supply

Upcoming unlocks for LayerZero, Optimism, and AltLayer tokens are set to release millions of new tokens into the market, potentially impacting prices.