Initial Farm Offering (IFO) 2.0

PancakeSwap
Apr 9 · 5 min read

PancakeSwappers and CAKE holders, today we are proud to give you a sneak peek of our new Initial Farm Offering (IFO) format: IFO 2.0!

(TLDR — New IFO next week. New token sale format with 2 sessions: Basic (max $100 contribution per person) and Unlimited (no max contribution, participation fee). Need a PancakeSwap Profile to participate. IFOs will burn more CAKE than ever before.)

When?

We’ll launch the first IFO using the new format next week and announce the project on Monday, April 12th.

What’s new?

1. You’ll need a PancakeSwap Profile in order to participate

2. There will now be two ways to participate, rather than only one: Basic and Unlimited.

Let’s break it down:

Profile

You won’t be able to participate unless you have an active PancakeSwap Profile.

If you haven’t made a profile yet, they cost 1.5 CAKE to set up. You also get to pick a cool NFT for your profile picture and join one of the three PancakeSwap teams!

If you’ve removed your profile picture, you’ll need to add it back.

Set up your PancakeSwap profile

Basic Sale

Want to participate in the IFO and get the most bang for your buck? This is for you.

In the “Basic” session, each person can contribute a MAXIMUM of $100 equivalent in CAKE-BNB LP tokens.

The amount of tokens available in this format will typically represent around 30% of the total sale.

Note that the final allocation you receive will still be subject to the total amount raised in this session, but the good news is you’re not battling any whales.

But can’t people just create multiple accounts?

Yes, they can. However, we expect that the initial cost of making a PancakeSwap profile for each account, vs the actual final allocation they may receive, will make this less effective than just participating in the Unlimited session instead.

Unlimited Sale

As the name suggests, the “Unlimited” session has no limits on the amount each person can contribute. However, this comes at the cost of a participation fee.

The number of tokens available in this format will typically account for 70% of the total sale.

How much is the participation fee?

The participation fee will start at 1%, which is only applied to your contribution to the “Unlimited” session.

The 1% participation fee decreases in cliffs, based on the percentage of overflow from the “Unlimited” portion of the sale.

Note that both the fee and scale are not fixed and will be customized for each IFO.

As an example, the fee cliff might look like this:

Where does the participation fee go?

We burn it. The participation fee collected goes straight to the kitchen and is yeeted into the fire. The CAKE-BNB LP tokens from the participation fee will be decomposed, then we will use the BNB portion to market buy the CAKE equivalent, then finally throw all of the CAKE in for the weekly burn.

Yes, on top of the CAKE from the IFO sale itself.

Yes, that means as a result, we will likely burn way more CAKE, in addition to recurring buy pressure from IFOs post sale.

What it looks like

(XYZ is an example, and not an actual project…)

Will the participation process still be the same?

Yes, the only real difference is that there are now two ways you can participate, instead of one.

Can I participate in both sessions of the sale?

Yes, you can do both, one or neither, but only if you have a PancakeSwap Profile already set up.

Why did we opt for this method?

While we can’t please everyone, we heard the feedback from the community loud and clear. So we opted to go for a bit of both, with the added objective of burning more CAKE than ever before.

The profile requirement creates an initial cost to participate, which makes sense if you plan on staying and using PancakeSwap long-term. However, if you are trying to mass create wallets to game the system, you won’t be benefiting much from it.

The “Basic” session will ensure people get a much larger allocation for a much smaller commitment ($100 equivalent) than they would have in the previous method. Also, at the bottom of the participation fee scale (0.2% in this example), it is likely that people will end up paying twice the USD equivalent per token as people that participate in the “Basic” session. This is due to the fact that the cost of their allocation may be equivalent to the participation fee.

In addition, the above would also help create an artificial price floor for the project since the initial cost of participating in the sale has essentially doubled to those in the “Unlimited” Session, without inflating their market cap.

There is also some interesting game theory in place with the whales that would previously create CAKE-WBNB LPs at the very last minute to participate in the IFO. If there’s less participation now with the fee, then the people that do participate get a higher allocation, and vice versa.

To sum up this section — Whales or those participating in the “Unlimited” session will pay more for their tokens than those that participate in the “Basic” session.

If you have any other questions at all, feel free to throw them at us on Twitter using the hashtag #PancakeSwapIFO and we will answer as many as we can.

Chef Hops 🐰

🥞 pancakeswap.finance/

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