KoinlyticsEvery trade in crypto is an instruction to a matching engine or a smart contract. Which instruction you send changes the outcome dramatically. The wrong order type is how retail loses money to unlucky fills.
Market order
Buy now at the best available price. Simple, guaranteed to fill, no slippage protection. In thin markets or during volatility, market buys chew through the order book and pay far worse than the displayed mid-price. Never market-buy an illiquid altcoin.
Limit order
Buy or sell at a specific price or better. If the price never gets there, the order sits open. Fills at your price or a favorable one. This is the default for serious trading. The downside is a limit buy at $30 does you no good if the coin drops to $20 without touching $30.
Stop order
Trigger a market order when price crosses a threshold. Used for stop-loss ("sell if this drops to $28k so I don't ride it down further") and stop-buy ("buy if this breaks $30k, confirming the breakout"). Slippage risk still applies once triggered.
Stop-limit order
Trigger a limit order when price crosses a threshold. Gives you price protection but risks not filling if the market moves through your limit. Dangerous in fast crashes: your stop-limit at $27,500 with a limit of $27,000 does nothing if the price gaps from $28k to $25k.
OCO (One-Cancels-Other)
Two orders, one gets executed, the other is auto-canceled. Common pattern: take-profit at $50k and stop-loss at $28k, both live. Whichever hits first, the other dies.
TWAP / iceberg
Break a large order into smaller pieces executed over time. TWAP orders sell 0.1 BTC every 60 seconds for 100 minutes instead of dumping 10 BTC at once. Reduces market impact. Standard on institutional CEX. Onchain: dedicated protocols (CoW, TWAMM on Uniswap V4) exist.
On-chain quirks
DEXs like Uniswap have no order book. All orders are market orders against a pool. Limit orders on-chain require either specialized protocols (0x, 1inch, CoW) or a bot watching the price and executing when hit.