CAKE Investors Can Revel in 10 Percent Jump as Binance Labs Invests in PancakeSwap
Crypto continues to embrace key aspects of traditional business. Popular cryptocurrency exchange, Binance, has reinforced this trend by investing in decentralized exchange (DEX), PancakeSwap, built on the BNB Chain.
PancakeSwap was launched in September 2020 and is a provider of an AMM or automated market maker which enables users to trade and swap decentralized finance or DeFi tokens.
Being the biggest dApp or decentralized app on Binance’s BNB Chain blockchain network, PancakeSwap boasts pretty close to having half a million global users.
Binance Labs will leverage the investment to continue the development of PancakeSwap’s community support, marketing, and technology in addition to driving Web3-based services. As the largest AMM on the Binance Smart Chain network, Pancake has close to $4 billion in staked assets.
Binance’s Web3 pursuit begins with a $105 million initiative to enhance the Web3 economy in France before the exchange qualified for a crypto license in the European country.
PancakeSwap enables the exchange of tokens, staking, and yield farming. Its native token, CAKE, jumped 10 percent after reports of the investment hit the streets. Despite hitting a $7.46 level ceiling one month ago, the news nudged CAKE up to $4.77 in trading after a market-wide slump in the crypto markets.
Users receive protocol liquidity pools or LP tokens for staking tokens in protocol liquidity pools. The LP tokens can be farmed to earn rewards as the PancakeSwap’s native CAKE token.
Traders can also make their CAKE rewards even bigger by staking in single-asset PancakeSwap Syrup Pools. Newer functionality on the platform includes an NFT marketplace, lottery system, prediction market, and Initial Farm Offering (IFO).
PancakeSwap NFT Collectibles
Anyone can purchase or win collectible NFTs with a bunny theme. After issuance, these NFTs can be sold for the CAKE value they represent or held as a collector’s item.
PancakeSwap regularly allows for NFT contests.
PancakeSwap IFOs
Initial Farm Offerings or IFOs can help new projects to serve tokens to users through yield farming. This involves requiring that LP tokens issued from specific staking pools are held on the protocol to access a token sale. Liquidity providers earn farming rewards from this scheme, while it also ensures that more initial token liquidity pools are available.
What Does the Future Hold for the PancakeSwap Cryptocurrency Ecosystem
While the operation of PancakeSwap is akin to other AMMs, the platform distinguishes itself by residing on the Binance Smart Chain network. Therefore, the DEX protocol has the objective of supporting more predictable and lower-cost transactions than other platforms built on Ethereum.
However, relying on CeDeFi has earned the platform criticism from the crypto community who have reservations about this model of decentralization, and are suspicious of centralization, and also from those who question the long-term reliability of this novel technology.
Despite concerns about the underlying technology, it’s clear that PancakeSwap is a big win for the Binance ecosystem, and looks set to give Uniswap a decent run for its money in DEX.
A Growing Pancake
PancakeSwap has grown in leaps and exponential bounds proportional to growing interest in DeFi or decentralized finance.
Ethereum remains a massive support for a slew of DeFi protocols, but PancakeSwap has been quite well received. If anything, it ensures innovation across alternative blockchain networks.
Honesty, it’s hard to fault Binance Lab’s investment in the project.
Besides the utility token topping 10 percent following the announcement from Binance (according to CoinMarketCap) and the protocol’s enviable daily user data, PancakeSwap has the highest TVL or total lock value on BSC – a whopping $3.9 billion. Binance continues to make efforts to bootstrap blockchain companies and startups. Its $500 million is the first of its kind that’s not capital
Barry Pene is a stern blockchain research/copywriter. Barry has been trading cryptos since 2017 and has been invested in issues that would put the blockchain industry on the right pedestal. Barry's research expertise cuts across blockchain as a disruptive technology, DeFis, NFTs, Web3, and reduction of energy consumption levels of cryptocurrency mining.
