PancakeSwap is not just another one DeFi app. Unlike many DEX, which are often built on the basis of Ethereum, PancakeSwap is built on the Binance Smart Chain. It is currently the №1 decentralized application in this network. In the article, we will consider what kind of platform this is, what a token CAKE is, and where it can be profitably traded.
What is PancakeSwap (CAKE)?
PancakeSwap is a decentralized cryptocurrency exchange for trading tokens of BEP20 standard on the Binance Smart Chain. The platform operates on the basis of an automatic market maker algorithm, where traders trade against a pool of liquidity. The platform provides the following services: swaps, liquidity pools, farming, stacking, and lotteries.
There is no classic order book on Pancake, but there are automatic liquidity pools through which cryptocurrency is exchanged (bought/sold). Each user can become a liquidity provider by depositing funds in the pool. In return, providers receive FLIP (LP) tokens. With the help of FLIP, providers can return part of the invested funds, as well as earn money on the trading operations of the platform. For each trading operation, users pay a fee of 0.25%, of which 0.17% goes to liquidity providers. In addition, the received LP tokens can be invested in CAKE farming. There is also a Syrup Pool on the platform — it is an opportunity to stake CAKE and earn CAKE or farm other tokens, depending on the selected pool.
Why should I trade PancakeSwap?
In short, you should look at CAKE for trading for the following reasons:
- PancakeSwap is the most famous DEX for trading BEP20 tokens. The platform provides favorable trading fees, as well as anonymous trading, which attracts many users.
- Since the launch of the project, the value of the CAKE coin has increased by more than 9000%. According to the forecasts of DigitalCoin, CoinPrice, EconomyForecastAgency and others, by the end of 2021, the cost of one coin will reach an average of $24.
As of August 9, 2021, the cost of CAKE has already reached $18.52. The market capitalization of PancakeSwap is $3,837,397,831. The lowest price of $0.198 was recorded on November 3, 2020. After that, the asset was traded for some time at a price not exceeding $1. With the onset of 2021, the price of the token is actively growing. On April 30, 2021, the price of CAKE reached a record high of $44.18.
Where to trade PancakeSwap?
Due to its youth, the CAKE cryptocurrency has not yet managed to be listed on many reputable trading platforms. However, there are still a number of exchanges and brokers that provide the opportunity to trade CAKE:
- Binance — a reliable multilingual multifunctional exchange with support for a fiat gateway for some cryptocurrencies.
Trading pairs: +2000.
- KuCoin — a well-known exchange with a large number of professional technical tools.
Trading pairs: about 1000.
- 7b — a secure broker with a user-friendly interface, transparent fees, and handy financial instruments.
Trading pairs: +2000.
How to trade PancakeSwap using the 7b crypto broker app?
By trading with the help of a 7b broker, a trader greatly facilitates his task. You do not need to deal with a complex interface, technical analysis tools, reading tables, and so on. You entrust all the difficult work to us, you have only to:
- Log in to your 7b account.
- Transfer funds from your wallet to your 7b balance.
- Enter “CAKE” in the search bar.
- Enter the desired amount.
- Click the “Buy” button.
- Wait for the funds to be credited to your account.
Where to exchange CAKE?
A novice trader who does not yet understand all the subtleties of the crypto market may wonder which platform to use for exchanging CAKE. We suggest that you take a look at the main advantages and disadvantages of the types of CAKE exchange services to facilitate your choice:
Advantages Disadvantages Provides the opportunity to exchange CAKE with a large selection of coins (more than 400 for 7b) Charges a relatively high fee Provides a secure environment for exchanging Provides unlimited exchange
Advantages Disadvantages Upon completion of the transaction, the coins are transferred to your wallet There is a possibility of security problems Provides a fixed and floating exchange rate There are limits on the exchange Provides anonymity
After choosing the type of service for exchanging CAKE, the next step will be to choose the platform itself. The list of the most popular swap platforms includes:
- CoinSpot — the platform was founded in 2013 and has been successfully functioning since then, providing the opportunity to exchange between more than 300 coins.
Service fee: 1%.
- Changelly — launched in 2015, the platform provides instant exchange at a fixed or floating rate for more than 170 coins.
Service fee: 0.25%.
- ChangeNOW — the platform provides the opportunity to exchange without registration. More than 170 coins are available.
Service fee: included in the exchange rate.
What to know before exchanging PancakeSwap?
So the type of service for the exchange is selected, the platforms are found and now you just have to choose one of them. Before making a choice and clicking on the “Exchange” button, we recommend you:
- Compare the exchange fee charged and choose the most profitable one.
- Compare exchange pairs. Perhaps the service does not support the one you need.
- Learn about the security and operation of the platform by studying user reviews.
- Carefully enter the wallet address. Remember, blockchain operations are irreversible.
How to buy PancakeSwap for fiat?
Just above, we analyzed where you can exchange CAKE and other cryptocurrencies. But initially, if you don’t have any coins to exchange, or you just want to spend free fiat money to buy CAKE, you can use platforms with a support of the fiat gateway. The selection options are also simple: security, a list of supported currencies, and fees charged. The list of such platforms includes Changelly and ChangeNOW. In order to make a fiat-on-crypto purchase, you have to:
- Choose a fiat currency.
- Select CAKE from the list of cryptocurrencies.
- Enter the purchase amount.
- Carefully enter your CAKE recipient address.
PancakeSwap token use cases
CAKE is a native PancakeSwap service token. It is a token of the BEP20 standard. Performs the following functions:
- Governance token. CAKE owners can vote for adding new tokens to create new liquidity pools.
- CAKE is used to reward users for providing liquidity, as well as for passive earnings on farming abd staking.
In addition, there is a FLIP token on the platform:
- LP (FLIP) token is provided to liquidity providers in exchange for their funds placed in the pool. LP tokens confirm the deposit of funds into the pool, reflect the share in the pool and remuneration is accrued on them.
Is PancakeSwap a good investment?
Yes, the prospects for the growth of the cost of CAKE are extremely optimistic. The project is very popular among traders from all over the world. In addition, the price of the asset has increased by more than 9000% in just a year, moreover, many analysts predict a further increase in the price.
How do I invest in PancakeSwap?
When it comes to a very volatile asset, such as a cryptocurrency, it is very important to study everything yourself to determine whether it is suitable for your investment portfolio. Remember that you should never invest more than you can afford to lose. For crypto-to-crypto purchases on 7b just: select cryptocurrencies, enter the amount, click “Buy”.
How to trade CAKE for beginners?
When starting trading, you should determine how much of your funds you are willing to risk and what profit you expect. This will be your risk-return ratio. Trading on large exchanges is more complex, compared to a broker. So on 7b, all that is required of you is to create an account, top up the balance, select a trading pair, and confirm the transaction.
What is PancakeSwap Blockchain?
PancakeSwap is a decentralized exchange for trading BEP20 tokens. The DEX is based on the Binance Smart Chain. The platform provides an opportunity for fast and secure trading, charging a transaction fee of 0.25%. In addition, tools for passive earnings are available on the platform.
Original source — How to trade CAKE