Launched on September 2020 by a group of anonymous developers, PancakeSwap is the leading Automated market maker on Finance Smart Chain. It is a decentralized exchange platform and one of the leading pools that allow for the seamless exchange of cryptocurrencies between users on the ecosystem.
As its name suggests, Pancake Swap is another food-themed Decentralized Finance protocol similar to Ethereum’s SushiSwap but with an extra benefit. Originally, the bulk of liquidity token trading and exchange took place on the Ethereum ecosystem mainly with popular protocols like UniSwap and formerly mentioned SushiSwap; but PancakeSwap is the first of its kind on the Binance Smart Chain (BSC). Due to the extra benefits and features BSC has over the Ethereum platform, the adoption of PancakeSwap has been received with open arms with over 2 million active users and traders and over one billion United States dollars traded.
This decentralized exchange platform allows for the exchange of BEP-20 tokens, a technical specification currency designed for the Binance Smart Chain. The token’s goal is to allow developers to launch a different range of tokens that can represent anything ranging from a Fiat currency to a share in a corporation.
PancakeSwap automated market model feature means there is an absence of an order book that matches you with someone or a corporation, rather it is a decentralized liquidity pool that allows users to exchange the approved tokens amongst one another.
These liquidity pools are filled with your fellow user’s funds that may have been deposited for the benefit of receive Liquidity provider tokens which they can use to reclaim shares or some portion of the charged trading fees.
These Liquidity Provider tokens are found positioned in different categories, for example, if you add the Binance United State Dollar stablecoin (BUSD) and the BNB, you will receive corresponding BUSD-BNB liquidity tokens in return.
The price of PancakeSwap is determined algorithmically based on the proportion of two traded assets or a system known as Constant Product Market Maker.
This technique is designed to ensure constant liquidity irrespective of the user’s order or resources in the pool. This constant liquidity is achieved by increasing the price of the orders as the number of orders required increases ensuring financial slippage of larger than normal orders.
When a transaction occurs in a pool, it is always between two tokens where the aim is to retain its constancy. This is done by increasing the sum of one transaction whilst decreasing the sum of the other based on the ratio approved.
PancakeSwap developed a token that allows and facilitates interaction between users and developers. CAKE is the official utility token of the platform and gives users the power to engage in several financial transactions, earn interests, win rewards, exchange assets and gain entry into new developments.
Who are the Founders of PancakeSwap (CAKE)?
As mentioned earlier, the developers of PancakeSwap are an anonymous group of developers with a penchant for breakfast and rabbit-affiliated ideas. Since they are anonymous, there is little to no information concerning their existence. But they aimed to provide a UniSwap lookalike devoid of the problems plaguing the Ethereum platform during that time.
At the time of PancakeSwap conception, the Ethereum platform was faced with issues like expensive transaction fees, slow transaction rates that deterred a lot of developers from using the platforms and its associated mini protocols.
The Advent of PancakeSwap was synonymous with the arrival of a savior as it offered a faster transaction rate and a lower swap fee of 0.2% while the industry was 0.3%.
What is PancakeSwap (CAKE) used for?
The beauty of the PancakeSwap protocol is it has a wide range of financial uses and they include:
Trade cryptocurrencies and tokens without the interference of an intermediary body
As users, privacy and control over our finances don’t sit right, so there is a need to source for a platform that allows for financial transactions without the interference of an external mediator governing our financial freedom.
There is no limit on what we can spend or buy, nor earn and receive. Hence, no need for questioning our finances.
The protocol allows users to earn rewards in form of their token, CAKE when users stake the approved or supported liquidity tokens in a yield farm. These rewards or yields are generated from the transaction fees generates during buying.
Swap between cryptocurrencies assets
Since the supporting platform allows the housing of various cryptocurrency assets and tokens, users can easily exchange from one currency to another at the expense of a few transactional charges.
What Is the Unique Point of PancakeSwap (CAKE)?
PancakeSwap has a lot of unique points compared to other swap protocols
Lower swap rate of 0.2%
One of the features that contributed to the meteoric uprise of PancakeSwap was the reduction of its Swap rate. Compared to other swap-like protocols out there that obey the standard 0.3% on every financial transaction, PancakeSwap has taken a step further to reduce their rate to a whopping 0.2%.
Faster transaction rate
The Binance smart chain platform has a faster transactional rate than that of Ethereum. The slow rate of Ethereum may be due to the number of developments it anchors, but BSC is faring better.
Community governance that promotes users inclusion
The governance system of PancakeSwap is a community inclusive governance that gives power to every user with CAKE tokens to take part in decision-making, and each user’s power is proportionate to the number of tokens held.
New and innovative features
The development team is consistently upgrading g and implanting new features that will be better than the system and in turn the users.
How many PancakeSwap (CAKE) is in circulation?
There are approximately 126 million CAKE tokens in circulation and a market capitalization value of $9.6 billion.
Is the Binance USD (BUSD) Network secured?
The protocol is fairly stable as there are both positive and fairly positive features concerning the security of the protocol and the token. It is certified, audited, and secured by the CertiK. CertiK is a leading security-focused ranking platform whose main job is to analyze, monitor, rate, and certify blockchain platforms, dApps, and Defi projects.
It has also proven to be secured as it is a non-custodial DEX platform that does not hold its user’s wallets in hot wallets and does not operate on a central body authority, rules, and regulations.
According to information on some Binance blog posts, it states that it is not completely safe as they only advise users to deposit funds they cannot afford to lose. They explained that depositing funds into a smart contract carries the risk of bugs, even for audited and reputable projects.
How do I buy PancakeSwap (CAKE)?
For new and existing crypto traders who would love to purchase CAKE tokens, there are several ways and they are:
Through public exchange blockchain platform
Signup to be a member/user by providing necessary details about you like: name, e-mail, verified licenses, and profile picture.
Input the required details of the information engraved on your debit/credit card and get the tokens (ensure you are connected to a stable and fast internet connection)
If you use private financial platforms like Paypal and Payoneer, link your account to that on the website and pay to get the tokens.
After successful sign-up, wire your desired amount of US dollars and exchange them for CAKE tokens.
Through the Binance exchange platform
Register and sign up to be a Binance user and provide necessary details similar to that of the Paxson service and purchase CAKE directly.
You can also exchange your other coins and tokens for an equal amount of BUSD tokens on the Binance platform. Transfers your tokens to a private hot or cold wallet for extra security.
Which Cryptocurrency Wallet Supports PancakeSwap (CAKE)?
The PTPWallet platform supports many cryptocurrencies simultaneously, such as PancakeSwap tokens. Because of its speed, flexibility, and unique features, it has grown to become one of the most used new platforms. In addition, users can easily use PTPWallet as their main PancakeSwap wallet as it offers a simple and interactive interface, making it easy to navigate its system.