Pancakeswap in focus, the DEX-king on the Binance-chain

By Austras | Crypto in focus | 11 Nov 2021


Why only hold your crypto when you can use it to grow your holding? Trading is a sure way to change the value of your portfolio, for better or worse. But as people trade, there are users who rather keep their crypto, but they still want to make some money. Pancakeswap sports an impressive arsenal that empower traders and holders, but how good is it?

Background

Pancakeswap was built and is being maintained by a group of anonymous developers. It launched near the end of 2020. It's been speculated that Pancakeswap is a fork of shushiswap, however, most of these claims seems to be unfounded. It is a fork of Uniswap, but adding in and building upon the foundation of Uniswap's initial offering.

The protocol has been audited by Certik and twice by slowmist, who highlighted issues and potential bugs. The developers listened to these suggested changes and improved upon the protocol giving it a 82% score on defi safety, one of the highest on the Binance-chain. The website hosting pancakeswap has been hacked once, hackers gained control of the website itself and changed it to display a prompt for users to enter their seed phrase. This means that the website itself was compromised and not the protocol, sadly several users gave away their phrase and compromised their wallets entirely.

Network

The swap is a simple protocol that allows users to swap tokens for a small fee on the Binance chain. In comparison to Uniswap, these fees are a fraction of what you pay normally. This is mainly thanks to the underlying blockchain having lower fees. The tokens swapped are being provided by users who can add tokens into "farms" or liquidity pools, where they get a portion of the fees and CAKE as rewards. This is a very common practice to provide a decentralized exchange service and it functions very well. Any changes or additions to the protocol itself is decided by the community through submission and voting on a proposal.

Use case

This is the area where Pancakeswap shines. Users can swap tokens, same as most other DEXes as well as add liquidity to any pool. Users who have added their coins into the liquidity pool will get LP tokens which can be used to farm more tokens. Alongside this, Pancakeswap also offer staking options which give rewards, these are available for a limited time a rotate frequently. CAKE staking is always available and is auto-compounded.

One-third way through the features on the site, Pancakeswap also offer NFTs native to the Binance-chain. These NFTs can be minted, sold or traded for CAKE on Pancakeswap. Last two features are the IFO and lottery. Initial farm offering (cute) is the same as an ICO where users can buy tokens ahead of time and potentially getting large returns. They do these IFOs one at a time and have done several in the past. The lottery is a place where users can buy lottery tickets and get 4 numbers between 1-14, if any of these match the day's winning ticket they get half the prize pool. There's also a new feature where users can gamble on predicting the price on BNB in the next five minutes, works the same as betting on anything with two outcomes.

Pancakeswap today

DEFI products outside of Ethereum will always be compared to it as Ethereum's DEFI scene is a powerhouse. Despite being built on a slightly less popular chain and only having access to the tokens on it natively, the swap performs very well. There are a large number of options to allow users to expose their crypto to growth potential. Despite having some shaky patches in its growth it's been fairly stable, taking security to heart. It is the largest BEP exchange today and for good reason. Keep your crypto safe: not your keys, not your coins.

Pros:
  • High reward yield
  • Multiple features
Cons:
  • Very new
  • Website has been hacked

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Austras
Austras

Product manager & tutor, love learning & teaching others. || https://cointr.ee/dorfel


Crypto in focus
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