The Launch of PancakeSwap at Zebpay
29 September 2021| ZebPay Trade-Desk
PancakeSwap, by far the most popular decentralized exchange (DEX) on Binance Smart Chain (BSC), has gained a lot of traction in the blockchain space in recent months, thanks to its massive liquidity, a wide range of features and base of business, of course, and considerable users. The platform is constructed to allow users to securely trade Binance Coin (BNB) and a wide range of BEP20 tokens without depending on centralized services or losing control of their private keys. Being a decentralized exchange, all transactions on PancakeSwap are done automatically through smart contracts – completely eliminating counterparty risks.
Although the PancakeSwap team is completely anonymous, the platform has been verified by several major blockchain security companies, including Certik and Slowmist. The platform is also fully open-source, as the PancakeSwap website and smart contract code are open for public scrutiny, however, the team is known to be made up of more than a dozen members (called chefs), including two leaders (Hops and Thumper) and a variety of engineers.
PancakeSwap Snapshot (at the time of writing):
| Market Capitalization | $4.15 Billion |
| Current Price | $18.38 |
| 24 HR Volume | $275,586,320 |
| All Time High/Low | $44.18/$0.19 |
| Script in Circulation | 226,124,420 CAKE |
| Total Supply | 226,124,420 CAKE |
With the launch in September 2020, the platform has seen phenomenal growth not only in user base and liquidity of supported assets but also in the wide range of features its offers. Now, PancakeSwap can be seen as a complete ecosystem of DeFi tools, all of which are built around the platform’s native utility token – CAKE. Since its launch, it has undergone numbers of updates each of which have added a new feature or product. The upgrade to V2 in April 2021, provided the developers more freedom to work and improve on the future functionality of the platform for example auto-compounding in syrups pools, adding of a referral program. And the most interesting one was a change of fee from 0.2% to 0.25% of which 0.05% was used to buy the native token from the public market and burning to add the deflationary mechanic to the CAKE.
The chefs of PancakeSwap as of now do not maintain a concrete roadmap, but there exists a list of to-do in public without any specific timelines. Some of the major items on the list are the inclusion of fixed-term staking products, borrowing, and lending features, and the ability for users to earn NFTs by completing tasks and leveling up. As of now, the Circulating supply is 226,228,958 CAKE tokens and there is no maximum supply data available.
Investment Analysis:
CAKE, the native PancakeSwap utility token, is used for multiple purposes in the growing landscape of the platform. Its major functions are staking, yield farming, participating in the PancakeSwap lottery, and processing and voting governance proposals through the platform’s community governance portal. UNI, the governance token of Uniswap was launched in 2020, it acts to enable shared community ownership in the development and growth of the decentralized protocol. This provides UNI holders to take part in the governance of the protocol in a neutral and trustless way. The Uniswap platform aims to make the token trading automatic and open to whoever holds the token along with working on the challenges the Centralized exchange faces and success and adoption of this positively impacting UNI token price, incentivizing the token holders and repeating the cycle.
Launched in September 2020 SushiSwap the fork of Uniswap was created to diversify the AMM market and add features not present in this older sibling. The platform takes away 0.3% from the transactions happening in the liquidity pool, the SUSHI token is used to incentivize and reward the users that amount of fees. The native token is also used to provide governance rights.
| Asset | CAKE | UNI | SUSHI |
| YTD Return (%) | 2687% | 374% | 201% |
| Return from ICO (%) | 1653% | 304% | 184% |
| Market Capitalization (bn) | $4.13 | $14.75 | $1.24 |
| Market Rank | 36 | 11 | 75 |
In the table above we can see the comparison between the top DeFi governance token. DeFi gained great popularity and the DeFi tokens occupied top places in terms of market cap this year. CAKE has risen by 2687% in the last 9 months compared to UNI token’s growth of 374% followed by SUSHI’s growth of 201%. This can be attributed to the DeFi boom this year, currently, the DeFi volume is almost 17% of the total crypto market volume.
Uniswap is ranked at 11th with $14.7 Billion in market capitalization followed by PancakeSwap which stands at 36th with $4.1 Billion followed by Sushiswap at 75th with $1.2 Billion respectively. CAKE tokens have provided the highest return since their initial offering followed by UNI around ABC% and then by SUSHI with about 201%.
| CAKE | Q1 2021 | Q2 2021 | Q3 2021 |
| Price (US $) | 5.49 | 22.74 | 18.64 |
| MoM ROI (%) | 1066.20% | 314.41% | -18.04% |
| Volume | 0.198 | 0.482 | 0.424 |
| % growth | 10093.60% | 142.65% | -12.01% |
| Market Cap | 0.919 | 3.74 | 3.93 |
| % growth | 4166.71% | 307.45% | 4.94% |
The table above shows the growth of CAKE since the last 3 quarters. Since its inception on September 29th, 2020 it has grown by about 1547% in terms of price. The first quarters of 2021 brought great heights for the asset, the price has risen by about 1066% since its existence. The price remained somewhat stable until this existing quarter where it fell due to volatility and instability in the market for various fundamental reasons.
The Volume followed the trails of price and continued a magnificent growth the first two quarters slumping in the last one due to overall loss in trading volume across the crypto market. The token volume has rallied by an almost whopping percentage of 5122. The market capitalization remained stable across the three quarters accelerating at a good speed now occupying the 36th rank. The coin market cap has swelled by over 46655% since the last september. As the coin celebrates its 1st birthday today it continues to compete with other DEX protocols changing and including more features and continues to climb the rank ladder.
Conclusion
Though the name PancakeSwap is comical in nature, it’s far from a joke. The platform that regularly beats the $100 million in 24-hour trading volume has taken the title of one of the most popular DApps of all time. It has become the most dominant DEX on Binance Smart Chain in less than a year leaving behind Binance’s own Binance DEX which makes the growth and adoption of PancakeSwap meteoric. The platform leverages a range of unique features which help in providing an amazing trading experience to end-users. One such example is the low transaction fees and rapid confirmation making sure the traders are executed fast. Another perk is unlike other platforms it doesn’t suffer from displacement attacks such as front-running due to the minimum block time which makes it very secure to use. Apart from this PancakeSwap also provides a variety of secondary features many of which enable the additional utility to CAKE holders. CAKE has made a name for itself in very little time, with new DeFi platforms sprouting out, it needs to upgrade itself to compete. PankcakeSwap rose to fame as a star in the DeFi sector taking advantage of the recent surge in the food-themed token and became the first billion dollar project on the Binance smart Chain. This definitely speaks for a great future for the platform and rally for our beloved dessert CAKE or Pancake.
References:
Disclaimer : This report is not intended to be relied upon as advice to investors or potential investors and does not take into account the investment objectives, financial situation or needs of any investor. All investors should consider such factors in consultation with a professional advisor of their choosing when deciding if an investment is appropriate. The Company has prepared this report based on information available to it, including information derived from public sources that have not been independently verified. No representation or warranty, express or implied, is provided in relation to the fairness, accuracy, correctness, completeness or reliability of the information, opinions or conclusions expressed herein. This report is preliminary and subject to change; the Company undertakes no obligation to update or revise the reports to reflect events or circumstances that arise after the date made or to reflect the occurrence of unanticipated events. Trading & Investments in cryptocurrencies viz. Bitcoin, Bitcoin Cash, Ethereum etc.are very speculative and are subject to market risks. The analysis by Author is for informational purposes only and should not be treated as investment advice
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