In every market, a certain number of people are willing to buy at the bid and sell at the ask. When you are trying to get rid of more than the market is able to absorb, you will wipe out multiple levels of bids. Slippage then refers to the price difference between (say) the mid price of the bid and ask and the price that you finally got filled at.
Say I want to sell 100 pokemons as fast as possible. I will take whatever the market wants to pay me. This is a market order.
Before my order goes in, people are willing to buy 10 pokemons at $50 and willing to sell 10 at $52. The midpoint is 51.
I put in my order.
10 of my pokemons get sold at $50. My slippage is $1x10.
The next level down is $48 where people are willing to buy 25 pokemons. So I will get filled now at $48. My slippage is $3x25=($51-48)x25.
Say I want to sell 100 pokemons as fast as possible. I will take whatever the market wants to pay me. This is a market order.
Before my order goes in, people are willing to buy 10 pokemons at $50 and willing to sell 10 at $52. The midpoint is 51.
I put in my order.
10 of my pokemons get sold at $50. My slippage is $1x10.
The next level down is $48 where people are willing to buy 25 pokemons. So I will get filled now at $48. My slippage is $3x25=($51-48)x25.
Etc