PancakeSwap

PancakeSwap is a decentralized finance (DeFi) application that allows users to exchange tokens in a decentralized manner and provide liquidity in return for fees.

What is PancakeSwap? 

  • PancakeSwap is an automated market maker (AMM) – aka a decentralized exchange – that is similar to Ethereum’s Uniswap, mainly used for swapping BEP20 tokens on Binance Smart Chain (BSC).
  • By being built on BSC, PancakeSwap has lower fees and faster transactions as compared to Uniswap, while also having various other benefits.
  • PancakeSwap also allows users to farm additional tokens such as CAKE or SYRUP as rewards for providing liquidity into a liquidity pool.
  • The Binance Bridge allows the “wrapping” of ERC-20 tokens into a BEP-20 token, that in turn allows it to be transacted on the BSC, and by extension, swapped on PancakeSwap.

Key Metrics

TickerCAKE
Token NamePancakeSwap
Token Type/ProtocolBEP20
Total Token Supply235,447,765
Current Circulating Supply See Coinmarketcap
Market CapitalisationSee Coinmarketcap
Token Creation DateSeptember 2020
Can it be mined?No

Who is behind PancakeSwap?

PancakeSwap was founded by anonymous developers in September 2020. It was first built on Binance Smart Chain (BSC).

Since the launch, PancakeSwap offered lower swap fees – as compared to Uniswap – at 0.3%, propelling rapid growth. As a result, PancakeSwap became one of the crypto space’s largest decentralized exchanges by trading volume in February 2021.

What is the purpose of PancakeSwap?

PancakeSwap was designed to be an automated market maker model using liquidity pools without order books. CAKE, the BEP-20 token that powers its ecosystem, is used to incentivize the liquidity provision to the PancakeSwap platform by being paid out as a reward.

Insights:

  • The decentralized exchange (DEX) enables token swaps without an intermediary, as well as earning yield through staking in a liquidity pool, lotteries where CAKE is burned, and much more.
  • PancakeSwap uses an automated market maker model where users trade against a liquidity pool. These pools are filled by users who deposit their funds into the pool and receive liquidity provider (LP) tokens in return.
  • Token swaps take place via liquidity pools between token pairs. Users are able to exchange one type of token for another in a decentralized manner, while other users who stake their tokens in the liquidity pools earn a share of the rewards generated by transactions. On the farm, users can deposit LP tokens and get rewarded with CAKE.
  • Users are allowed to stake CAKE, PancakeSwap’s native token, and earn even more CAKE just by letting it sit there in the Syrup Pool over time via the decentralized exchange (DEX).
  • Moreover, there’s an auto-stake option that will re-stake your CAKE at least once per hour, continuously compounding your rewards.

Risks:

  • PancakeSwap does not provide a native wallet. Therefore, users are required to educate themselves, choose and fund a wallet, as well as access PancakeSwap by themselves.
  • The fact that PancakeSwap’s founder team has remained anonymous might affect its credibility among users. 

News and Updates:

  • Duelist King, the First GameFi Project IFO (Initial Farm Offering), announced its first Initial Farm Offering on PancakeSwap. Users can participate in the IFO powered by PancakeSwap DEX with the Non-fungible token (NFT) card game.
  • PancakeSwap posted the To-Do list update to clarify its current focus to users. The list also comes with a backlog that comprises other innovations left out to focus on other projects.
    https://twitter.com/PancakeSwap/status/1448240546867146752
  • PancakeSwap announced its CAKE burn update. It clarified that the Decentralized Exchange (DEX) burned over 7 million $CAKE, worth $132 million in its recent CAKE burn. The protocol also broke down the token-burn feature on twitter.
    https://twitter.com/pancakeswap/status/1447846900523143175?s=21

Community & Whitepaper Links

Disclaimer  

All investments are speculative and involve substantial risk and uncertainty. Investors should understand the nature of digital assets including the terms of return and the risk of assets. We encourage investors to fully understand the assets and the risk associated with them prior to making any investment.  

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