RE: The Blackrock ETF Rake
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Slippage and impermanent loss are two different things.
Slippage is movement of price by your trade.
Impermanent loss only occurs to liquidity providers, and is the movement of their pair ratio as price moves.
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That's exactly what I said.
AKA the price slipping.
I did not make a mistake.
Impermanent loss is something even experts incorrectly describe.
If they ever use the word "arbitrage" in the definition: they are wrong.
And they ALL use the word arbitrage.
Arb has nothing to do with IL.
No, that's not exactly what you said lol. You claim they wrongfully call slippage for IL.
The price isn't slipping, your trade at perceived price do.
Slippage is your loss in a trade because price moves, while IL is movement in your LP token's pair proportion.
Your slippage don't accumulate, impermanent losses do as long as price move one direction only.
Being a liquidity provider in an AMM pool is the same thing as actively trading.
Except instead of making conscious decisions the algorithm does it automatically.
Very similar to running a bot on non-AMM orderbooks.
Every trade requires two parties.
In an orderbook the liquidity providers are makers only (limit orders).
In a basic AMM, liquidity providers don't get to pick and choose their limits,
so they are kinda like makers and takers on a sliding scale.
Meanwhile, slippage is only relevant on an orderbook when bots don't replace that liquidity behind you and you'd have to sell at a loss. Unsurprisingly, slippage happens when the price slips. The only time price doesn't slip is a static limit order. Everything else is slippage.
I did like a dozen hours of research on this because it was explained so poorly.
Link a better explanation or come up with a relevant example with numbers if you think you can prove otherwise.
I'm guessing you did not read the relevant post I wrote that I linked in the previous comment.