Exchange Rate and Fees

Exchange Rate

While Morphex always strives to give you the best exchange rate for your assets, the rate can be affected by several factors:

• Set slippage tolerance

• Price impact

• Order routing

There is also a small swap fee when swapping tokens.

Let's discuss all of it, step-by-step.

Slippage Tolerance

Slippage tolerance is the maximum price difference you're willing to accept between the expected price of a trade and the executed price.

When you make a swap on Morphex, prices can change between the time you submit the transaction and when it actually goes through (especially in volatile markets or with low liquidity). That change is called slippage.

For example, you want to swap 1000 LUMIA for 34.7 USDT. But by the time your transaction goes through, the price drops and you're only getting 34.006 USDT.

• If your slippage tolerance is set to 2%, you’ll allow the trade to go through as long as you receive at least 34.006 USDT (within 2% of 34.7).

• If the price slips more than 2%, the transaction will fail — protecting you from unexpected losses.

How to set?

You may set slippage tolerance value yourself when swapping.

Price Impact

Price impact is the difference between the current market price of a token and the price you actually pay when making a trade — caused by the size of your trade, i.e. how it's moving the market.

When you swap tokens on Morphex, you’re trading directly against a liquidity pool, not an order book. If your trade is large compared to the pool size, you change the ratio of assets in the pool — which changes the price for everyone, including yourself. That change is called price impact.

For example, you want to buy 100 USDT worth of LUMIA, but the pool only has 1000 USDT worth of liquidity. Your big order pushes the price up — you get fewer tokens per USDT as you go deeper into the pool. That difference is price impact.

• If the starting price is 1 USDT = 2.856701 LUMIA

• But your trade ends up averaging 1 USDT = 2.82813399 LUMIA

• That 10% difference is your price impact

Price Impact vs Slippage

• Price impact is caused by the size of your trade relative to the pool.

• Slippage includes price changes from other traders or delays in transaction execution.

Both matter — especially if you’re trading large amounts.

Order Routing

Order routing is the process of finding the best path to execute a trade across one or more liquidity sources — like liquidity pools or aggregators — to get you the best price with the least slippage.

Imagine you want to swap Token A for Token B.

But:

• Liquidity Pool #1 has a decent price but not much liquidity.

• Liquidity Pool #2 has more liquidity but a slightly worse price.

• There’s also a route through Token C (A → C → B) that gives you a better result overall.

You don’t have to think about it — order routing does the heavy lifting behind the scenes.

Swap Fee

Swap fee is the small percentage you pay when you make a token swap on Morphex. It’s how the protocol and liquidity providers (LPs) earn revenue for facilitating your trade.

Morphex operates through liquidity pools set by liquidity providers interested in facilitating trading for a fee.

There are 4 tiers for a swap fee on Morphex, depending on the settings chosen by the liquidity pool creator:

• 0.01%

• 0.05%

• 0.3%

• 1%

Where Does the Swap Fee Go?

Mophex is fairly straightforward and transparent in its financial model, so the swap fee goes to liquidity providers and platform (LUMIA buybacks and treasury) in the following proportions:

• 80% go to liquidity providers.

• 20% go to the platform and used for paying referral program and other incentives.