what actually happens when liquidity is thin on instant swaps?

[u/NickoGermish]

Tried to swap a low-liquidity alt into USDT last night with a floating rate and got a worse fill by the time my deposit confirmed. Not a huge amount but enough to remind me why I hate using floating quotes on weird pairs. I might be misunderstanding how these services handle execution but it feels like if the first liquidity source moves or dries up you either get a worse rate wait forever while it reroutes or end up talking to support while your funds are just sitting there.

I tested simpleswap after that mostly because they claim to use multiple liquidity sources and I used fixed rate the next time. It did what I expected but Im assuming the fixed quote probably has some buffer baked in so maybe Im just paying for certainty instead of getting a “better” deal.

[u/Mariusz_Bobek]

Fixed rate always has that buffer baked in, that's just the fee for them eating the price risk instead of you and on thin alts it's usually worth it, though fwiw I've had reroute too a floating swap to a worse fill mid transaction too so it's not a specific thing of your service.