Dive into PancakeSwap: The No 1 Liquidity Provider on Binance Smart Chain
PancakeSwap is currently No 1 AMM(Automated Market Maker) on Binance Smart Chain. When writing this article(22 October 2020), PancakeSwap is holding $236,110,968 in Liquidity. It has a $15,408,750(24 hours) Trading volume, whither the nearest rival, BSCSwap, has $907,161 in its Liquidity Pool. Also, it has $15,408,750 trading volume.
PancakeSwap is one of the invested projects on Binance Smart Chain by Binance.
Introduction of PancakeSwap
PancakeSwap is a Food-themed DiFi protocol. Nowadays, we see many Food-themed projects in the DeFi space. Some undisclosed Developers kickstarted the project on Binance Smart Chain(BSC). PancakeSwap is a fork of SushiSwap. We remember Sushi, Yam, Spaghetti, etc. These Food-themed DeFi projects attracted investors to them. PancakeSwap is the best example of this success. Currently, PancakeSwap is among the top 7 largest YieldFarming Platform in Value Locked.
Introduction of Binance Smart Chain
Binance Smart Chain(BSC) is a blockchain running parallel to the Binance Chain(BC). BNB is the native token on Binance Smart Chain. It means that if you interact on the BSC network, you will have to pay fees with BNB. Also, BSC validators will be rewarded in native BNB. BSC integrated smart contract functionality and compatibility with the Ethereum Virtual Machine (EVM) As Ethereum Virtual Machine (EVM) was included, BSC supports Ethereum tools and Dapps. These advantages attracted projects to launch on BSC. Surprisingly, you can interact with BSC with your Metamask Ethereum Wallet. Currently, Binance Smart Chain is supported by Binance Exchange, Trust Wallet, Binance Chain Extension Wallet, Math Wallet, SafePal Wallet, Trezor hardware wallet, Ledger Nano S, and more coming. Also, you can interact with BSC DAPPs with your Metamask Wallet.
Know About Cake Token:
CAKE is a token offered by PancakeSwap. SYRUP is the governance token in the PancakeSwap. By locking LP Tokens, you will earn CAKE as a reward. Moreover, you will get SYRUP by staking your delicious CAKEs.
Important information to know
Token: CAKE
Contract Address: https://bscscan.com/token/0x7d813C828b0d1083Bb08b38841C45304A920060b 717
Chain: Binance Smart Chain (BEP-20)
Emission rate:
Reward per block — 40 CAKE
Daily emission (Based on 30k blocks per day) — 1,200,000 CAKE per day
Information Source: https://community.trustwallet.com/t/how-to-earn-farm-and-stake-cake-on-pancakeswap-with-trust-wallet/70964
Exploring the Abilities of PancakeSwap
If you ever visited https://pancakeswap.finance/, you will see all functions. But before you explore all of the functions, you need to unlock the wallet. I said before; you need to have a BSC supported Dapp Browser or Binance Chain Extension Wallet. Even you can use your Metamask Extension Wallet. If you don’t know how to proceed with the Metamask Extension Wallet, read the documentation by Binance. I suggest you read how to use the Metamask Wallet guide. In this article, I will use my Trust Wallet.
Exchanging Tokens on PancakeSwap
- Open your Dapp Browser in Trust Wallet. Copy-paste this URL https://exchange.pancakeswap.finance in the box.
- A new UI will appear. Let’s select the BNB-CAKE pair. We will swap BNB to CAKE token.
- Select how much BNB you will swap or how much CAKE you want to buy. If you are ready to proceed, click the “Swap” button.
- Now this will require further confirmation. Click Confirm Swap if you are fully confirmed.
- A new window will show you how much you have to spend. It will show how much gas fee will be required. Approve the transaction.
You are Done. You will receive your CAKE in your wallet in a few seconds as BSC is not congested like Ethereum Chain.
Adding Liquidity in the Pool
You can supply tokens it the DEX. To do so, please follow the following process.
- Click Add Liquidity to add liquidity to the pool.
- For illustration purposes, we will proceed with the BNB-CAKE pair to supply Liquidity.
- Enter your desired amount and hit Approve CAKE. Tap on Supply and then Confirm.
You will get a confirmation message that you have supplied token to the pool. You will get LP tokens from PancakeSwap. These LP tokens are also known as FLIP tokens.
Farming and Staking
PancakeSwap will let you farm CAKE. On the farm, stake following LP tokens to earn CAKE. It will maximize your reward up to 20X.
- CAKE-BNB FLIP
- BUSD-BNB FLIP
- ADA-BNB FLIP
- BAND-BNB FLIP
- DOT-BNB FLIP
- EOS-BNB FLIP
- LINK-BNB FLIP
- USDT-BUSD FLIP
- TWT-BNB FLIP
- XVS-BNB FLIP
- ETH-BNB FLIP
- BTCB-BNB FLIP
- ALPHA-BNB FLIP
- USDT-BNB FLIP
- XRP-BNB FLIP
- ATOM-BNB FLIP
- YFII-BNB FLIP
- DAI- BNB FLIP
- XTZ-BNB FLIP
- BCH-BNB FLIP
- YFI-BNB FLIP
- UNI-BNB FLIP
- FIL-BNB FLIP
- INJ-BNB FLIP
Staking Your LP Tokens
- To join the PancakeSwap kitchen, follow this link https://pancakeswap.finance/farms.
- For illustration purposes, we will choose CAKE-BNB FLIP Farm. Approve it to proceed next step.
- Press on +sign to input the amount you desire to stake. You will get CAKE instantly.
Your CAKE-BNB will be staked after successful network confirmation.
Staking CAKE
If you’ve earned CAKE, you can stake to get SYRUP as a reward. SYRUP is the Governance Token on the PancakeSwap platform. You will get voting right for holding SYRUP. You can also participate in the Lottery.
- Go to this link directly https://pancakeswap.finance/staking.
- Approve CAKE for Staking.
- Press the + sign and adjust your amount of CAKE tokens to stake.
- After confirming, you will get equal SYRUPs. Amazingly, you will earn some CAKE too.
Is PancakeSwap is Risky for Your Assets?
Depositing assets into Smart contracts is risky. You will be glad to know that the PancakeSwap security audit is complete. Certik completes the audit. You can read the audit report here. You must be careful using unaudited smart contracts. Do you remember? In 2016, hackers stole $50 million worth ether from the DAO. DAO stands for Decentralized Autonomous Organization. You will be relieved to know that Ethereum reversed the transaction.
However, this doesn’t mean that the audited smart contract isn’t risky. But Security Audit mitigates the risk by minimizing bug.
Conclusion
Ethereum started the DeFi trend. But it’s looking that BSC is going to take the act as a leader. Obviously, PancakeSwap will fuel the DeFi trend. Uniswap led AMM till now. We assume that PancakeSwap will continue this trend.
Thanks to
I took the help of the following articles. I also took some images from them to complete the article. Thanks to their author.
