CAKE is the native token on the PancakeSwap exchange used for transactions, governance, and execution of reward programs. PancakeSwap is part of a growing trend of food-themed projects including BakerySwap, Uniswap (UNI) and SushiSwap among other projects.
Unlike other food projects that run on Ethereum (ETH), PancakeSwap is built on the Binance Smart Chain (BSC), a complementary network of the Binance Chain (BC). This article provides a detailed review of the CAKE token, its price forecast, and an overview of the PancakeSwap ecosystem;
Table of Contents:
What Is PancakeSwap?
PancakeSwap is a decentralized exchange on the Binance Smart Chain (BSC) that offers automated permissionless liquidity pools that run on algorithms. It is the use of algorithms that PancakeSwap an automated market maker. As an automated market maker (AMM), PancakeSwap offers several innovative ways for cryptocurrency holders to earn from their assets.
How does PancakeSwap work?
PancakeSwap offers several advanced and innovative features that set it apart from other DeFi protocols. Although Ethereum has been a pioneer in the DeFi space, some of its features have failed to resonate with many users who have seen many migrate to PancakeSwap. Some of the best features of PancakeSwap include the possibility of seamless interaction between Ethereum-based dApps and BSC-based dApps, BEP-20 token trading, lottery, picketing, and farming.
PancakeSwap Exchange
The PancakeSwap protocol uses the automated market maker (AMM) model to provide liquidity to traders. AMM uses an algorithm to evaluate assets as opposed to centralized exchanges (CEX) which rely on traditional order books. In an AMM, borrowers can access liquidity in a liquidity pool compared to a typical order book that relies on buyers and sellers.
The main feature of PancakeSwap is the ability to exchange BEP-20 tokens instead of ERC-20 tokens. Users deposit their funds in liquidity pools from which they derive returns in the form of Liquidity Provider (LP) tokens, called CAKEs.
PancakeSwap Trading
Much of the CAKE token trading takes place on PancakeSwap, although a certain amount of trading takes place on Binance. Users can also buy tokens on Binance, transfer them to a compatible wallet from where they can be wagered on PancakeSwap.
Wallets supported by PancakeSwap
In addition to the native wallet, PancakeSwap supports other wallets such as MetaMask and MathWallet, WalletConnect, TokenPocket, and Trust Wallet.
CAKE token distribution
Users can buy CAKE tokens or earn them through pointing their crypto assets. Currently users earn 40 CAKEs for each block created. However, 15 CAKEs are burned when they are created as a single block. In one day, a total of 30k blocks and 1.2 million CAKEs are created and 450,000 tokens per day. The actual daily issue is 750,000 CAKE. Block rewards are distributed as follows;
· 60% or 15 CAKEs are allocated to farmers
· 40% or 10 CAKE go to CAKE holders
· Of the 30 blocks created every day, 450,000 CAKEs are reserved for agriculture
· A total of 300,000 CAKEs are awarded to token holders every day.
How to point the cake?
To bet CAKE tokens, you must first buy them from any quote exchange and transfer them to a wallet that is compatible or supported by PancakeSwap. In addition, users can also choose to purchase BNB tokens that can be wagered to earn CAKE tokens on PancakeSwap.
Before staking, users must first link their wallets to PancakeSwap from where they access liquidity pools in the “Pools” tab. You can then select where to point tokens in the listed liquidity pools. If it is BNB, you can transfer them to a BEP-20 BSC address to facilitate the payment of transaction fees. One of the advantages of using the BSC is the low transaction fees charged on all trades.
Adding liquidity on PancakeSwap
The first step when using an AMM like PancakeSwap is to add liquidity. PancakeSwap users can add liquidity to the platform by clicking “Trade” in the left sidebar which then brings a drop-down menu. Click “Add Liquidity” and select the token pair you want to deposit to provide liquidity.
Agriculture
There are several ways CAKE holders can earn from tokens deposited in a liquidity pool on PancakeSwap. The platform is above all to have high returns on the staked assets. Users can bet deposited LP tokens to earn more CAKE tokens. Staking is one of the easiest and safest ways to earn tokens without engaging in risky investments.
To point, hover over PancakeSwap and click on the “Farm” tab located in the left sidebar. There are several ways in which users can earn from their tokens on PancakeSwap. There are currently 69 liquidity pools listed where users can bet their assets and earn returns of between 23.52% and 378.19% APY. To complete the transfer of liquidity to the platform, users must approve the movement of tokens deposited to the pools. The approval authorizes smart contracts to withdraw and withdraw funds on behalf of the user.
Click “Approve contract” and confirm the amount of tokens you have with the main bet. Tokens will be deducted from the wallet and returns will begin to accumulate on the placed assets after some time. Users can redeem the token rewards earned by clicking “Harvest”. Examples of pools available for staking include;
· CAKE-BNB LP
· DODO-BNB LP
· BRY-BNB LP
· GDP SUSHI-ETH
· DAI-BUSD LP
· ZEE-BNB LP
· SWINGBY-BNB LP
· LTC-BNB LP
Users are rewarded by the LP in CAKE tokens that can be used to pay transaction fees, for governance votes and wagered to earn more CAKE.
In addition to the farm that produces the LP tokens, users can bet CAKE tokens in SYRUP pools to benefit from returns ranging from 43.33% to 275.12% APY. Users can also bet CAKE tokens to earn rewards to earn other coins such as UST, LINA, and SWINGBY to name a few.
Deflationary
PancakeSwap has integrated with several deflationary protocols to maintain the value of its token. For example, all CAKE tokens collected in initial agricultural offerings (IFOs) are burned. In addition, 10% of PancakeSwap lottery profits plus a certain percentage of grown CAKEs are burned. These protocols help developers protect investors and maintain price stability in a highly elevated market.
CAKE Price Forecast for the next 90 days
The entire cryptocurrency world is on the verge of complete collapse. Bitcoin fell 75% from its all-time high amid broader market declines caused by furious inflation and the US Fed’s rate hikes.
When you add the most recent collapses of huge industry players (FTX, Celsius, Moon etc.) into the equation, the horizon is murky and there will be more blood on the streets of the crypto city.
Investors are selling risky assets and moving to more stable markets. Crypto is still perceived as a very risky game and therefore sell off.
Our algo still sees some green in 2023, especially in the second half of the year. This is reflected in our forecast for 2023.
Right now, Bitcoin needs to find a bottom before we can move in the opposite direction and reverse the trend.
Once Bitcoin settles into the new price range, altcoins will start doing the same – we’ve seen this scenario dozens of times in distant and more recent history.
Our price forecasting model is bearish for the next 90 days with a hint of a bull market straddling quarters from Q1 to Q2. We expect whales and other larger players in the market to finish filling their bags around that time, which will cause a typical and sudden crypto spike.
The fundamentals we evaluate are teams, tokenomics, use case, community, marketing efforts, liquidity and availability of exchange, hype and speculative potential, and some other proprietary factors developed in our crypto lab.
PancakeSwap (CAKE) Market Price Forecast
PancakeSwap just completed a lottery giveaway totaling around $2.75 million that saw its native cryptocurrency CAKE soar by more than 25%. The exchange handled a lottery pot of 131,507.51 CAKE, its largest ever. CAKE is currently priced at $21.26 after rising from $6 in February. The token increased by 1,200% between 2020 and 2021. Predictions in 2020 had predicted that the token would trade in the %8 and $15 range. It was unlikely among the majority analysts that the coin could reach $21.
In February 2021, the token was projected to trade between $60 and $80 by the end of the year according to data on Coinpedia. The coin is expected to reach $150 by the end of 2022 and $280 over the next five years.
In March of this year, FXStreet predicted that the token would trade at $21.70 by the end of the year. During the month, the token was priced at around $12. Another analyst, Wallet Investor has set a price target of $44.20 for the CAKE token by the end of 2021. According to Wallet Investor, CAKE will be trading at $154 over the next five years.
Digital Coin Price, another leading platform that tracks cryptocurrency trading and price data, has set the CAKE price target at $31.24 by the end of 2021 and $35.77 by the end of 2022. The token is expected to reach $62.80 by 2025 according to Digital Coin Price.
CAKE Price Prediction 2023
Our forecast model calls for a temporary shift to a bear market in early 2023 before moving to another lead in Q3 and Q4 of 2023.
CAKE Price Prediction 2025 – 2030 – 2040
Our forecasting model sees CAKE reaching new highs in 2025:
$12.54
The price of CAKE in 2030 and 2040 is expected to be a couple of orders of magnitude higher than our 2025 forecast.
Initial farm supply (IFO)
A key feature of PancakeSwap is that it allows users to create and list their projects in the BSC ecosystem. Performance farming allows users to deposit their assets and start projects in liquidity pools to earn premiums.
To participate in the IFO, developers must purchase CAKE and Binance tokens to get their CAKE-BNB LP tokens that are used when the IFO sale process begins. It is the CAKE-LP tokens that developers undertake to purchase IFO tokens.
SCROPPER Pools
The PancakeSwap platform also offers another type of pools called SYRUP pools that offer much higher yields. SYRUP liquidity pools offer much higher premiums between 43.33% and 275.12% APY. In addition to CAKE, users can also bet other tokens to earn CAKE or other token rewards.
Non-fungible tokens
In addition to crop yield, lottery ticket purchase, and CAKE staking, PancakeSwap also allows users to win non-fungible tokens created by the exchange. NFTs collected can be stored in wallets or exchanged for CAKE.
The platform selects NFT winners randomly. To win, participants must first register and log in to the PancakeSwap Collectibles page, where new NFTs are published every day.
Is PancakeSwap safe?
PancakeSwap has worked without any problems or hitches since its launch. Also, no adverse issues such as fraud or hacking have been reported on the platform. The decentralized exchange was controlled by CertiK and its code was found to be secure.
What to consider when buying PancakeSwap
Below are the main factors to consider when buying CAKE;
Operational framework
Unlike many crypto exchanges that rely on a traditional order book, PancakeSwap uses an automated market maker (AMM) model. The platform is designed in such a way that users have to deposit their funds into a liquidity pool to receive a portion of future trading fees and consistent returns.
Recycled source code
Many decentralized applications share the same source code with few changes and minor changes. For example, SushiSwap is an improved version of UniSwap while PancakeSwap is generally an imitation of SushiSwap with some improved features and functionality.
interoperability
Binance Smart Chain (BSC) is fully compatible with Ethereum Virtual Machine (EVM) so it allows the development of interoperable dApps. The platform also allows for a wide range of Ether-based wallets including MetaMask, MEW among others.
Tariff model
Trading fee is an important factor to consider when choosing a platform. On BSC, users pay a flat rate of 0.2% on all transactions. Of the total fees, 0.17% goes to liquidity providers while the remaining amount if burned.
New product offerings
In addition to yield cultivation options, PancakeSwap comes with an integrated NFT marketplace and a platform for initial farm offerings (IFOs). The NFT marketplace allows users to buy/sell a wide range of tokenized assets.
PancakeSwap Roadmap
PancakeSwap had a clear roadmap that saw the project add innovative features. The following features are still being worked out in different phases;
· Margin Trading where users will be able to trade BSC tokens with on-chain leverage.
· Lending & Borrowing where users can lend and borrow BSC and LP tokens.
· Fixed-term bet
· Binary Options
· NFT-based gamification
Advantages of Pancake Swap
The main benefits of PancakeSwap include;
· It allows users to access a wide range of new tokens and also allows users to transfer USDT, BTC, BUSD and ETH from the ETH chain to the BSC chain.
· It is able to integrate with major wallets such as MetaMask, MathWallet, WalletConnect, TokenPocket, and Trust Wallet.
· Although it is feature-rich, the PancakeSwap exchange is a lot to use and traders don’t need to have previous experience to navigate through basic trading features.
· The PancakeSwap exchange has very few transaction fees especially for those who use the native CAKE coin.
· The platform is hosted on the BSC making it very fast and offers a more responsive trading experience. With faster transactions, investors can access more arbitrage trading opportunities.
Frequently asked questions
What Is PancakeSwap?
PancakeSwap is one of many food-themed DeFi protocols with similar functionality to Uniswap and Sushiswap
Who created PancakeSwap?
The main developers behind PancakeSwap remain anonymous. The only thing known is that the protocol uses BCS technology and is controlled by Certik.
What is the CAKE token?
CAKE is PancakeSwap’s native and governance resource, which you can cultivate and bet on to earn rewards.
What is SYRUP?
Syrup pools are the main yield aggregators where you can bet your CAKE
What is the difference between picketing and farming?
Yield farming is a process of blocking funds into loan pools where other borrowers lend their funds in exchange for interest.
