The “Price impact too high” is an error that occurred after PancakeSwap moved from Version1 to Version2. PancakeSwap developers should be the ones to ensure the coherence of both versions to prevent the error from occurring. In the meantime, there are a number of solutions that you can try to work around the error.
In this article, you will learn why you are experiencing this error and how to fix it.
What is Price Impact?
Price impact refers to how underlying tokens will affect your trade/transaction based on the market price. In simple language, the error means that you might lose a substantial part of your cash if you continue with your transaction. The price impact links directly to the pool liquidity, i.e., if the token pairs are illiquid, the price impact will be high and vice versa.
For example, a swap for $80 worth of Dipper Network from $190 worth of Ethereum will attract a price impact of about 60%. The reason for such a high price impact is because there are few Dipper Network sellers hence the exorbitant costs. The error would otherwise not occur if both tokens had high liquidity.
You can either decrease the amount you want to be swapped or you can wait for more liquidity in the pool. Since the PancakeSwap migration to V2, the error became more prevalent. The reason is that the liquidity pool on this version is lower than that on V1 i.e. because it’s either still updating or migrating.
How to Fix the “Price Impact Too High!” Error for PancakeSwap
There are three ways you can fix the “Price impact too high” error for PancakeSwap
1. Change the PancakeSwap Exchange Version You Are Using
On the bottom navigation bar, you will select V1 as the version you want to use to transact the swap. It will give you a pop-up message that PancakeSwap V1 is no longer supported. You will check that you understand the disclaimer and click on continue with V1 anyway.
2. Either Break Down Your Transactions or Reduce Your Purchase Amounts
The error means that your transaction will have a high price impact, therefore, cannot complete your swap. To solve the problem, you can buy crypto using smaller amounts. If you want to buy or sell more, you can break them into several transactions.
3. Increase the Price Slippage Tolerance for Your Transactions
If the market is experiencing high price fluctuations and the time to register the transaction is taking long, then you might need to increase the slippage tolerance to complete the swap. A big difference in price slippage tolerance will always come with a warning. This comes in handy due to the highlights of Liquidity Providers (LP) and Automatic Market Maker (AMM).
Click on the gear symbol and scroll down to the price slippage tolerance tab. Select a higher price slippage tolerance in increments until the error is no longer coming up.
You can try other simple solutions such as using a different device and browser application. Sometimes, using a higher-speed internet could do the trick.