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Best Practices for Trading on Orca

Whether you're new to DeFi or an experienced trader, following best practices when using Orca can help maximize your success and minimize risks. This guide covers our recommended practices based on years of observing the Solana DeFi ecosystem.

Note: This guide is written by Orca Insights Blog, an independent publication covering the Orca ecosystem. We are not affiliated with or endorsed by Orca Exchange.

Security Best Practices

Use a Hardware Wallet

For significant holdings, consider using a hardware wallet like Ledger with your Solana wallet. Hardware wallets keep your private keys offline, providing an extra layer of security against online threats.

Create a Dedicated Trading Wallet

Consider creating a separate wallet specifically for trading on DEXs. This compartmentalizes risk - if one wallet is compromised, you won't lose all your assets.

Verify URLs Carefully

Always double-check the URL before connecting your wallet. Bookmark the official Orca website and always use your bookmark instead of clicking links from emails, Discord, or Telegram.

Warning: Never share your seed phrase or private keys with anyone, including support staff. Legitimate support will never ask for these.

Trading Best Practices

Start Small

If you're new to Orca or testing a new pool, start with small amounts until you're comfortable with how everything works.

Understand Slippage Tolerance

Set appropriate slippage tolerance based on the liquidity of the tokens you're trading and market conditions. Higher slippage may be necessary for less liquid tokens, but increases the risk of price impact.

Keep SOL for Gas

Always maintain a small amount of SOL in your wallet for transaction fees. We recommend keeping at least 0.05 SOL available at all times.

Be Mindful of Volatility

During periods of high market volatility, consider waiting for conditions to stabilize before making large trades, as price fluctuations can lead to higher slippage.

Orca-Specific Best Practices

Choose the Right Pool Type

Standard pools are simpler and sufficient for most users. Whirlpools offer potentially better rates but are more complex. Choose based on your experience level and trading needs.

Use Smart Route for Better Rates

Orca's smart routing can find the best path for your trade through multiple pools. This is generally advantageous but may involve higher gas fees for complex routes.

Consider Transaction Timing

The Solana network can be congested at times. If not urgent, consider making trades during off-peak hours for lower fees and faster confirmations.

Risk Management Practices

Research Tokens Thoroughly

Before trading any token, research its fundamentals, team, community, and market behavior. Be especially cautious with new tokens that have limited history.

Diversify Your Holdings

Don't put all your assets into a single token or pool. Diversification can help mitigate risk in the volatile crypto market.

Calculate Price Impact

For larger trades, be aware of price impact. Breaking a large trade into several smaller ones can help minimize slippage and price impact.

Keep Records

Maintain detailed records of all your trades for tax purposes and personal tracking. This is especially important in DeFi where transactions can be complex.

Important: Never invest more than you can afford to lose. DeFi markets can be highly volatile, and while they offer significant opportunities, they also come with substantial risks.

Technical Considerations

Use a Reliable Browser

Chrome or Brave browsers tend to work best with Solana DApps. Keep your browser and wallet extensions updated to the latest versions.

Ensure Stable Connection

A stable internet connection is crucial when executing trades to prevent failed transactions or unexpected behavior.

Clear Cache if Issues Arise

If you experience unexpected behavior on Orca, try clearing your browser cache and reconnecting your wallet.

By following these best practices, you can navigate the Orca ecosystem more effectively and securely. Remember that continuous learning and staying updated with the latest developments in DeFi are also key practices for long-term success.

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