PancakeSwap is a decentralized exchange that allows individuals to trade in cryptocurrency by paying a lower price than many other decentralized exchanges. It lets investors earn interest on their upstanding crypto assets by staking or lending them. Being decentralized, it allows its users to keep control of the private keys to their tokens.
PancakeSwap is one of the most popular decentralized exchanges that allows its investors to swap Binance Smart Chain Tokens easily. It uses liquidity pools that do not require permission. Being run by integrated algorithms, it is automatic. The following are the main features of PancakeSwap that make it one of the most popular DEX available in the market.
PancakeSwap charges a much lower price when compared to other exchanges, both centralized as well as decentralized. It takes a flat commission of only 0.25% on every trade, which is much smaller than the rate charged by other exchanges like Uniswap.
PancakeSwap allows its users to trade “on the spot.” In other words, it allows individuals to buy and sell crypto at a specified market rate. One can easily swap BEP-20 tokens such as ETH and CAKE with the help of PancakeSwap. However, one must first connect their existing wallet holding the tokens they want to swap.
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Initial Farm Offerings (IFO)
The Initial Farm Offerings feature of PankcakeSwap gives the users early access to the tokens that are newly added to it. To avail of this, an individual needs to swap CAKE tokens for iCAKE, the currency used exclusively for buying tokens from farm offerings.
Yield farming is defined as earning interest on crypto assets by depositing them into liquidity pools. Such assets earn rewards which are then distributed proportionally among the contributors. One can also lock up their tokens for a fixed time or choose a more flexible option and claim the asset whenever they want. PancakeSwap gives its users access to such liquidity pools known as “farms,” whose interest rate can be as high as 10%.
PancakeSwap frequently runs prediction markets that allow investors to bet on the movement of the price of a token. In addition, individuals who manage to be on the winning side can also end up earning lucrative rewards.
PancakeSwap also runs frequent lotteries that allow individuals to win many CAKE tokens. One can win thousands of dollars worth of CAKE tokens by paying a minimal entry amount.
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Since one of the biggest concerns of crypto enthusiasts is the security of their assets, PancakeSwap has given maximum importance to it. Some of the main security features of PancakeSwap include the following:
- Bug Bounty- PancakeSwap came up with a unique way of getting its users involved in strengthening its security. It offers generous rewards to every individual who identifies any security flaws on the platform.
- SSL encryption- It is a protocol designed to protect all data transferred between an individual’s web browser and PancakeSwap’s servers. Thus, it prevents the sudden loss of data due to transactional issues. The above feature also prevents hackers from accessing an individual’s personal or confidential details.
- Audits- Trusted companies like Slowmist and Certrik frequently test the security of actions provided by PancakeSwap.
Comprehensive Review of PancakeSwap
PancakeSwap was launched in September 2020. It is based on Binance Smart Chain or Binance Blockchain. Because of its popularity among crypto enthusiasts has seen an average yearly growth of about 870% in the last 3 years. In April 2021, PancakeSwap launched PancakeSwap V2 and added several other DeFi features. To understand the working of PancakeSwap better, one must first go through its pros and cons, as mentioned below.
PancageSwap has an interface that is extremely well-designed and intuitive. Although the complexities of its features make it hard for unseasoned users to use it, its website interface is detailed and self-explanatory.
Low Transactional Fees
As mentioned earlier, PancakeSwap charges a much lower fee than many other decentralized exchanges available in the market. While the standard commission of most DEXes is 0.3% per trade, Pancakeswap charges only 0.25% for every trade. It charges no fees at all for withdrawing assets from the liquidity pool.
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The yields of assets on PancakeSwap range anywhere from 24% to 378%. Thus, it is undoubtedly much higher than that of other exchanges.
Chance To Win NFTs
NFTs or Non-fungible tokens are cryptographic records on blockchains that no one can legally replicate. PancakeSwap allows its users to win such NFTs by participating in lotteries.
One of the major advantages of using PancakeSwap is that it allows individuals to stake. If one wants to earn interest on the excess crypto assets standing in their wallet, they can easily stake or lend them through the liquidity pool. Thus, individuals can make a passive income by using PancakeSwap.
Control Over Private Keys
As mentioned above, PancakeSwap allows individuals to hold private keys to their tokens. Consequently, in case of data misplacement during the transaction process, there would not be a fear of permanent loss of assets.
No Mobile App
Unlike most decentralized exchanges, PancakeSwap does not have a mobile app which restricts its accessibility to the common masses.
BTC Not Supported
PancakeSwap does not allow individuals to trade Bitcoins. In fact, it doesn’t allow its users to trade anything other than BEP-20 tokens.
No Native Crypto Wallet
Lastly, PancakeSwap does not have a native crypto wallet. To carry out any form of trading on this platform, one must first connect their existing wallet to the website interface.
To summarise, PancakeSwap is a cost-effective decentralized exchange that is best for individuals who prefer to trade without intermediaries. Apart from that, it also allows its users to keep control of their tokens. Being one of the largest AMM projects based on BSC, PancakeSwap is widely popular among the masses. By tackling some of the most prominent crypto-based challenges, such as centralization and high fees, PancakeSwap can help make the crypto economy faster, scalable, and more efficient.