Sweet Brunch in the virtual asset world — PancakeSwap
Hello. This is Editor Y of Team Protocon.
It’s been a long time:) Did you read the last episode <A rising star in the virtual asset world — KLAYswap> well? If you missed it, please click the link, and check it out.
This time it’s the last episode of Discover DeFi Projects! Let’s take a moment to learn about the Pancake Swap, developed by anonymous developers who love breakfast and rabbits.
What is PancakeSwap?
Check point 1. Uniswap’s Rival
For a while, DeFi projects with food motifs such as Sushi Swap, Bakery Swap, and Honey Swap caught the attention of cryptocurrency users around the world. PancakeSwap is similarly a DeFi project named after food.
Most of the DeFi projects were focused on the Ethereum blockchain. This is because Ethereum already has a strong presence in the market, as well as various communities, developers, and tools for building dApps.
The PancakeSwap we will discuss in this episode is a decentralized exchange (DEX) built on the Binance Smart Chain (BSC). PancakeSwap is quite similar to Uniswap in that they use liquidity pools and Automated Market Makers (AMMs). To put it more directly, you could say that PancakeSwap is Uniswap for the Binance Smart Chain.
Check point 2. Automated exchange
PancakeSwap is designed to allow users to securely trade Binance Coin (BNB) and various BEP-20 tokens without relying on a centralized service or losing control of their private keys. As a decentralized exchange, all transactions on PancakeSwap are automatically executed through smart contracts to ensure safe transactions.
PancakeSwap does not have an order book due to the nature of the platform that uses AMM. Instead, users will be able to stake their coins in a liquidity pool to provide liquidity for trading cryptocurrencies in specific pairs. Simply, on PancakeSwap, you can trade BEP-20 tokens or contribute to the liquidity pool and get rewards.
Check point 3. Tremendous growth
Since its launch in September 2020, PancakeSwap has seen tremendous growth in the number of users and liquidity of the assets it supports, as well as in the variety of features it provides.
Based on CoinMarketCap, it is currently ranked 4th in DEX and currently has a 24-hour trading volume of $950,734,477. According to the official Pancake Swap website, it has secured about 2.8 million users and recorded 31 million transactions in the past 30 days.
In addition, the current Total Value Locked is $11 billion, which is about 13 trillion won in Korean currency. It is the largest DEX in BSC.
Although the amount is lower than Uniswap or other Ethereum-based DEXs, it continues to increase.
What makes PancakeSwap special!
- CAKE token and SYRUP pool
PancakeSwap is based on Cake, a BEP-20 token running on the Binance Smart Chain.
First of all, PancakeSwap provides two types of interest farming: staking liquidity provider tokens to obtain CAKE or staking CAKE to obtain CAKE or other BEP-20 tokens.
Users can get additional tokens by staking them in a fluid pool called Syrup Pool. Many of these pools have an annual return of over 100%.
Unlike other native tokens, CAKE tokens do not have a supply hardcap. Currently, it has about 165 million supplies.
To mitigate falling inflation, the platform has a built-in deflation mechanism that incinerates a significant portion of the daily CAKE tokens.
For example, incinerate half of the 40 CAKEs generated per block and incinerate all CAKEs used for lottery, forecast betting, transactions, etc. Despite this mechanism, about 530,000 new tokens are generated every day.
- PANCAKESWAP NFT
Pancake swaps also have several game functions. It provides a CAKE lottery, BNB price prediction betting system, and trading competitions.
Users can also obtain cute NFTs unique to pancake swaps. You can also hold the acquired NFT or trade it with CAKE.
On October 7, a new NFT collection “Pancake Squad” was issued only 10,000, and a user who said one of them was traded for 200 million won appeared in the domestic community.
What’s the future of the PancakeSwap?
Pancake swap is a rising star in BSC. Due to BSC’s relatively low transaction fees, it has a significant competitive advantage over other major DEXs, and is showing rapid growth by taking advantage of this well. However, due to the nature of the ever-changing cryptocurrency market, I think the growth of the project depends on how you adapt to and develop.
Through this series of DeFi projects, we have confirmed that projects that have changed and developed to suit the taste of users are on the path of success. Team Protocon will also be a project that continues to develop in line with changes. With this episode as the last one, we will wrap up the DeFi project finding series. Please look forward to what the next series will cover.
That’s it for editor Y!