Are you getting “Price Impact too high” message on Pancakeswap or Uniswap? We have given here the probable causes why you are facing the error warning and the solutions to fix the Price Impact too High Message. The error message is shown in the following way in Pancakeswap:
What is Price Impact?
In blockchain technology, the Price Impact Mechanism works to prevent manipulation of cryptocurrency token prices by Whales. The whales buy or sell a large number of tokens or coins and this impacts the market price of the coin.
To prevent this, the Price Impact mechanism has been introduced. With this mechanism, the purchase or sale price of a crypto asset in a DeFi Exchange becomes inversely related to its trading quantity.
In a nutshell, if any whale tends to purchase or sale a large number of shares of a coin’s supply that is presently circulating in the market, then its purchasing price or selling price along with the charges becomes too uneconomical to buy. So, the whale has to cancel the transaction.
This way, the Price Impact Mechanism works to regulate the price of crypto tokens in a Decentralized Exchanges like PancakeSwap and Uniswap.
How to Fix Price Impact too High?
As we have come to know what is meant by the term Price Impact, let us check the probable solutions which may be causing the error. There are 3 possible ways to solve the problem.
1. Breaking Down Transactions into small quantities
The main solution of showing price impact too high is to reduce the amount of purchasing and selling the number of crypto tokens.
Suppose if you want to purchase 1 Million tokens in Pancakeswap, then you may break the transactions into 5 small parts and in every small transaction, you can buy 200K Tokens.
This will reduce the price impact while buying bulk quantity tokens.
2. Updating V2 from V1 for Pancakeswap & V3 from V2 in Uniswap
If you have been trying to purchase coins through Pancakeswap V1, then there is a high chance you are getting the problem.
You can check the version of Pancakeswap in Trustwallet or in your DeFi browser as shown in the image below:
To change your version to V2, you just need to click on the V2 icon.
3. Increasing Slippage Tolerance
Crypto currency is a market where the price of coins fluctuates to a great extent. This causes an abnormal price impact.
To fix this, you need to increase the slippage tolerance while making the transaction.
You can read a detailed article here on How to Increase Slippage Tolerance to Avoid insufficient Liquidity Error in pancakeswap & uniswap.
These are the ways you can solve the Price Impact too high Error in Pancakeswap and Uniswap.
So, the Price Impact Too High Error can be solved by using these steps given above. If you are still facing the issue, you can reinstall the DeFi apps such as Trustwallet or Metamask Wallet.
Also, you can try other centralized exchanges where the coin you want to purchase is listed. You can also open the Pancakeswap.finance exchange in a different browser (Click to Open) and connect to your wallet.
In case of any doubt or if you have any other solution, comment below.