What is a “Limit Order”?

Limit Orders are, in essence, instructions to BUY or SELL an asset at a specific price. Limit orders allow you to get your swaps at desired prices by leaving instructions to fill buy or sell orders at specific prices. The trade will only be executed if the price of the token reached your limit price (or better).

Here is an example of a Limit Order:

BNB is currently trading at 400 BUSD per unit. (BUSD is a stable coin pegged to USD but the price is not exactly 1 USD. It may be a little bit more expensive or cheaper than 1 USD based on market conditions.)

You wish to buy 1 BNB but you only have 350 BUSD. You believe that the BNB price will be below 350 BUSD at a later point. It can be 1 day or 2 days, or even 1 month.

Based on this belief, you create a Limit Buy of 1 BNB at the price of 350 BUSD.

If the BNB unit price falls under 350 BUSD or below, your Limit Buy order will be executed, and you will get 1 BNB.

If the BNB unit price does not fall to your limit purchase price, the order will not be processed and thus will remain in the contract until the unit price meets your requirement.