What Is PancakeSwap (CAKE)?
PancakeSwap is a decentralized finance (DeFi) blockchain app that enables its users to swap crypto tokens. The PancakeSwap platform allows users to trade without requiring them to go through a centralized exchange. The PancakeSwap platform aims to provide an opportunity for users to trade and earn crypto on the Binance Smart Chain within seconds.
The three ways users can earn more from the crypto tokens on PancakeSwap are trading, earning, and winning. The platform is an automated market maker (AMM) that provides various features that power decentralized trading. The PancakeSwap platform allows users to trade on BEP20 tokens, offer liquidity to the decentralized exchange (DEX), and acquire fees. BEP20 is a token standard built on Binance Smart Chain.
Since PancakeSwap functions in the BNB blockchain, it charges low transaction fees. The platform also offers low trading fees to its users. Even if the trading pair of users is not powered on the farm page, they can still obtain trading fees while staking their tokens in the liquidity pools.
According to the whitepaper, the users use their wallet app to trade. Anything they do on the platform is routed directly via their wallet. However, the users need not register an account for using the platform, as they only need a crypto wallet. Users must set up a wallet supported by BNB Smart Chain (BSC). Wallets are accessible both on smartphone devices and desktop computers. The platform is created on open-source software. Thus, the sites of the platform and its smart contracts are visible to everyone, providing maximum transparency. Token swaps on the platform are a simple method to trade BEP20 tokens for any other token through automated liquidity pools.
The native token of the PancakeSwap ecosystem is CAKE, and its total supply is 277.39 million. The primary function of the CAKE token is to incentivize the token holders by offering liquidity to the exchange. The token holders can vote on proposals concerning the PancakeSwap ecosystem. Voting provides a voice to the community of PancakeSwap to have a say in how the platform can develop itself into the future.
A dynamic quantity of CAKE tokens is minted at 9.09% to the dev address. Moreover, the users can mint non-fungible tokens (NFTs) by creating their Pancake profile. The token holders get the chance of winning collectible NFTs for contributing to trading competitions and games.
How Are CAKE Tokens Earned?
The users can stake LP tokens for earning CAKE tokens. Users can obtain CAKE from syrup and farm pools and win the lottery token. Syrup pools are a method of allocating tokens to BSC users who stake CAKE tokens in the pool. Staking in syrup pools can help users to earn more rewards. The users can use the tokens in yield farms to obtain many CAKE tokens. Yield farming lets users obtain CAKE rewards by reserving their LP tokens within a smart contract. LP tokens let users earn more rewards as trading fees and ensure that liquidity is always available for the exchange to be used.
