PancakeSwap is a Binance Smart-Chain based decentralized exchange. This food-inspired protocol uses an automated market maker model which allows participants to transact on liquidity pools funded by other users. With a codebase almost the same as that of SushiSwap, PancakeSwap incorporates additional features that include lotteries and farming on other systems.

PancakeSwap runs on the Binance Smart Chain
Source: Binance

Origin of PancakeSwap

The DeFi protocol was brought to light by some unknown developers in September 2020. What makes PancakeSwap stand out is its cheaper network fees and swap fees. As it operates in the BSC network, its transaction fees only range from $0.04 to $o.20. It also has a fast transaction speed which will only take about 5 seconds on average. Additionally, users from anywhere across the globe can transact at PancakeSwap without extensive requirements to prove their identity.

The currency supports well-known wallets such as WalletConnect, MetaTask, Trust Wallet, MathWallet, and TokenPocket. Along with its close rival UniSwap, PancakeSwap became among the largest in the industry in terms of trade volumes in February 2021, with a track record of 31 million trades, 2.8 million users, and staked over $12 billion.

CAKE Price Chart

Users deposit funds into the liquidity pool and get a liquidity provider (LP) token in return. You can redeem shares with these tokens and pay for the trading fees. The protocol also lets users farm “Cake” which is the governance token in the PancakeSwap ecosystem and a BEP-20 token on the Binance Smart Chain. This can be done by depositing their LP tokens and locking them in the process which rewards them with Cake. Users can expect more rewards if they stake their cake in Syrup pools. Aside from farming, PancakeSwap also offers lotteries that normally take 6 hours. A lottery ticket costs 10 CAKE and the buyer receives a random four-digit number. To win the jackpot, the four numbers and their positions should match the winning ticket.

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