PancakeSwap is a decentralized cryptocurrency exchange built on the Binance Smart Chain (BSC). It was launched in September 2020. The exchange can be compared to well-established platforms, such as Uniswap, in the sense that users are able to trade their assets with other users without the involvement of any intermediary services. This process is called token swapping. Besides that, PancakeSwap also offers earning possibilities, as well as an NFT marketplace and GameFi.
PancakeSwap crypto exchange is focused on BEP-20 tokens, which is a particular token standard designed by Binance. The BEP-20 standard is simply a checklist of operations that new tokens need to be able to execute in order to be compatible with the larger Binance ecosystem, which consists of decentralized applications (dApps), wallets, and other services.
To begin using the PancakeSwap crypto exchange, users are not required to complete any kind of KYC. Also, it can be used on both – mobile devices and computers.
Though it's important to note that, in April 2021, a new, upgraded version of PancakeSwap rolled out (V2) and became the main functional version of the exchange. The PancakeSwap V1 (the one about which this text is about) is no longer supported. However, it is still active and people can use it if they're not afraid of slippage that could result in capital loss.
Since PancakeSwap is a decentralized platform, users are free to publish their own assets as long as there is sufficient liquidity to support the supply. Thus, the overall number of listed assets consequently fluctuates. Overall, there are more than 290 PancakeSwap trading pairs available.
Though it's important to note that there is no PancakeSwap spot market available if we looked at it in a traditional way. Instead, the market of PancakeSwap is a peer-to-peer market where users are able to trade with one another right from their wallets.
Perpetual futures contracts are also available on the PancakeSwap cryptocurrency exchange. Users have the option of using the advanced or lite perpetual trade modes. The advanced mode is suggested for experienced traders, while the light level is designed for beginners.
The PancakeSwap exchange fees are set per trade, therefore the same amount is charged regardless of the personal PancakeSwap trade volume or traded assets. The maker-taker paradigm is also not applicable. The fee stands at 0.25% per trade. A fraction of this sum, 0.17%, is added to the token pair's liquidity pool.
CAKE is the native cryptocurrency of PancakeSwap. It serves as the primary utility asset that generates passive income and is utilized to pay fees. By clicking here, you can learn more about CAKE and the PancakeSwap crypto price.
PancakeSwap makes use of an AMM that is supported by the crypto assets that are placed into smart contracts, which are also referred to as liquidity pools. Liquidity providers are rewarded with a portion of the Pancake Swap exchange fees that are paid by traders. The overall amount of liquidity that each liquidity provider contributes to the pool determines the percentage that is allotted to that liquidity source.
In addition to this, liquidity providers have the ability to take things to the next level by participating in yield-farming activities. To do this, the investor must first deposit a pair of BEP-20 tokens into the relevant pool and then collect liquidity pool (LP) tokens. These tokens indicate the total amount of money that has been contributed to a pool by all of the individual liquidity providers. After that, the liquidity provider is able to place the LP tokens in a farm so that they may create revenue denominated in CAKE.
The CAKE token that is obtained via yield farming has the ability to be staked in the Syrup pools on PancakeSwap in order to create extra interest. As a result, this method combines three different options to generate money in order to entice liquidity providers and assist them in increasing their earnings.
Other services that can be found on PancakeSwap include a lottery, a marketplace for non-fungible tokens (NFTs), and an initial farming offering. The initial farming offering is a service that was developed to assist BSC developers in raising liquidity for their projects and to give users access to the tokens of newly launched BSC dApps.
About the Company
PancakeSwap is a decentralized exchange as well as an AMM that began its operations in September 2020. In a manner similar to that of Uniswap, which was first established on Ethereum, it was established by unknown creators on the basis of the Binance Smart Chain. The headquarters of the company is located in Fukuoka, Japan.
It even has certain features that are similar to Uniswap, such as community governance and the ability to farm LP (liquidity pool) tokens. The company claims that PancakeSwap was a Minimum Viable Product (MVP) at the time of its introduction and that there was no way to customize the contracts to meet the requirements of individual customers.
The capacity for the upgrading of the contract was made available with the development of the migration function. Migration made it possible to implement brand-new features including a buy-back option, a referral scheme, and the inclusion of burn mechanisms to trading cost structures. The ability to automatically compound, minting that may be customized, and a number of other features were added to the Syrup Pools.
The PancakeSwap cryptocurrency exchange team is anonymous. The few things that are known about the creators are that they have a soft spot in their hearts for bunnies and breakfast items, and that they are called the Kitchen Team, or the Chefs.
When the PancakeSwap was upgraded to the V2 version in April 2021, the PancakeSwap volume dropped tremendously. To compare, as of January 2023, the PancakeSwap trade volume (24-hour) stands at $153,039, while the V2 volume stands at $48,067,260.