Differences Between Clipping and Compression
Clipping, as a form of signal compression, differs from the operation of the typical studio audio level compressor, in which gain compression is not instantaneous (delayed in time via attack and release settings).
Clipping destroys any audio information which is over a certain threshold. Compression and limiting change the shape of the entire waveform, not just the shape of the waveform above the threshold. This is why it is possible to limit and compress with very high ratios without causing distortion.
Read more about this topic: Gain Compression
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