On centralized exchanges (CEX), all private keys, and with them, user funds, are in the hands of the site owner. The data is stored on servers, the provider is responsible for its processing and safety.
Pancake Swap is a decentralized exchange (DEX). Each transaction creates a smart contract on the network that you sign and send some tokens in exchange for others. Even if the site is destroyed or hacked, it won’t affect user balances in any way. Anyone can revive a copy of PancakeSwap Exchange from the public blockchain, where all smart contracts are open.
A nice consequence of DEX is the need to get liquidity from somewhere. On CEX exchanges, professional, often hired, market makers are responsible for this. They, unlike regular users, have no extra commission on transactions. This allows them to maintain the market price of assets, providing liquidity of currency pairs.
At PancakeSwap, liquidity is maintained by the automatic market-making system (AMM). Any willing user can contribute their tokens to the pool, and in return, they will start receiving yields. PancakeSwap pays an additional 7% to 400% per annum in the form of a CAKE token. The project is in the early stages of development, and these bonuses may decrease over time!
Where to buy PancakeSwap (CAKE)
The CAKE token is listed on many decentralized and centralized cryptocurrency exchanges. And of course, to purchase the coin on its own DEX PancakeSwap. Below we will consider each of the options in detail. Binance crypto exchange gained its huge popularity by its functionality, support of almost all known cryptocurrencies, and low commissions. You can buy PancakeSwap (CAKE) on the platform not only with a bank card but also for other cryptocurrencies.
To do this, you will need to use the platform’s trading terminal:
- Register or log in to your existing Binance account.
- Fund your exchange account using the “Deposit” section in your cabinet. In case you want to fund your trading account with fiat currency, you will have to verify it first.
- Open the classic trading terminal and using the search box, find pairs with CAKE.
- Click on the appropriate trading pair and place your order to purchase coins, specifying the quantity and value.
There are six pairs with CAKE on Binance, including popular stabelcoins, Bitcoin, and several fiat currencies. Payment options: cryptocurrencies, stabelcoins, payment cards, bank account transfers, and more.
- low trading commissions;
- leverage up to x5 for some pairs with CAKE;
- the exchange is available in 23 languages and supports a variety of local currencies;
- any VISA/Mastercard, as well as 100+ other ways to pay.
Using the exchange
To use the exchange PancakeSwap you need to attach a wallet to it. We recommend using MetaMask, it is convenient to install as a plugin on Google Chrome or a cell phone. Once you connect your wallet to the exchanger, you will be able to use all its features anonymously.
Functions of PancakeSwap:
- Exchange tokens in 250 pairs;
- buying NFT collections;
- participation in the CAKE lottery;
- farming and staking.
To make an exchange, you just need to select the tokens you are interested in and specify their quantity, as well as choose the tokens you are ready to give away. The exchange will automatically calculate the exchange path and give you the number of tokens you will receive.
Farming and Staking at PancakeSwap
Well now let’s take a look at how to farm and stack on PancakeSwap finance. The difference between these two earning schemes is that when farming, users contribute some coins and get rewarded with quite different coins.
- Farming. To farm, go to the “Farms” tab on the same side menu, and choose the farm for the LP tokens we discussed above. Next, it’s simple: we add the amount required for farming and confirm the operation. That’s it, CAKE tokens are sent to farming. Collecting rewards can be done once a day or, for example, once a week.
- Staking. With staking is even easier than with farming. For this, we buy CAKE tokens and send them to the CAKE staking pool. The resulting profit can be withdrawn (Harvest), reinvested (Compound), added more coins (+), etc. We recommend reinvesting to get even more income in the future.
You send BNB, and dividends accrue CAKE tokens. Well, Stackers get their interest in the cryptocurrency of the network they work with. At PancakeSwap, it is possible to earn both farming and staking. In the Farming section, customers bet with LP tokens BNB, BU.
Buying the right token
You can trade on PancakeSwap in the Exchange section. There are no stock charts and other trader stuff. You choose a pair, specify the amount and make the exchange. The second section Liquidity is for creating wrapped tokens, which are provided to the liquidity pool.
Before you send assets to the pool, you need to confirm that the smart contract has access to the assets on your balance. The transaction is triggered directly in the site interface and confirmed in the wallet.
- Select Exchange and specify a pair, for example, BNB-BUSD.
- Write the amount of the transaction.
- Click Exchange on the site and confirm the action in the wallet interface.
- Click Confirm the exchange and again confirm the operation in the wallet.
Finished, BUSD coins bought. For the operation, your balance will be charged a small amount in BNB. You can send coins to the liquidity pool, or keep them in your wallet. Dividends will still be credited. The CAKE tokens you receive can be sent to the stack and receive an additional reward as a syrup holder. From each block, 75% of CAKE is transferred to farmers and 25% to stakers.
Lottery and Prediction Cards at PancakeSwap
There are two other products on the PancakeSwap exchange worth mentioning. The first is a lottery, a user can buy a ticket with a six-digit number and if they match the numbers they roll, they take away a certain portion of the bank. The second product is Prediction, which is a futures contract disguised as a game. A user can guess that a certain asset will go up or its price will go down.
The lottery is held every 6 hours and one ticket costs 10 CAKE. When you buy a ticket, you get a random combination of 4 numbers from 1 to 14. At the end of the lottery period, the exchange will call the 4 winning numbers. If your numbers match completely, you will receive 50% of the entire lottery pool (the jackpot). If 2 or more numbers match, you will also receive a reward.
PancakeSwap also allows you to take part in draws for special NFT (non-exchangeable tokens) issued on the platform. Winning tokens can be exchanged for CAKE or you can build your collection of Metaverse NFTs to Buy tokens. Winners are determined at random. To participate in the drawing of non-exchangeable tokens, register on the NFT page.
What is IFO?
Inside PancakeSwap there is another inconspicuous section. It is for newly created tokens, the use of which is both a risk and an opportunity for additional income. You can use in this section your LP tokens received for participating in the exchange’s liquidity pool. This will give you access to new tokens that are not yet available to all others.
PancakeSwap Finance is a decentralized set of open-source smart contracts. It has no governing body or person in charge (developed by an anonymous team). The level of trust in the service should be determined based on a vulnerability analysis of the code if any.
Tips for safe buying and storing
The world of cryptocurrencies is notorious for its high volatility, which can make you lose all your money as soon as you start investing. But the danger lies not only in the unpredictable value. Few people think about how to keep currencies safe and end up a victim of cybercriminals.
Stick to the following simple tips to protect your assets from theft:
- Choose your cooperation platforms carefully. Trust your funds only to proven platforms that have a good reputation and pay a lot of attention to security.
- Use complex passwords to protect your accounts. The minimum password should contain 8 characters, numbers, different cases, and one wildcard.
- Make sure you have strong anti-virus protection on your devices and keep them up to date. PC virus infection may result in the theft of private keys.
- Keep your assets in a hold where cybercriminals simply can’t get to them. On hot storage wallets, such as exchange wallets, it is advisable to leave only small amounts needed for trading or daily spending.
- Remember that cryptocurrency transactions are irreversible, so carefully check the details to which you send payment.
The CAKE token was launched by the decentralized cryptocurrency exchange PancakeSwap and serves many functions on the platform. You can buy the coin directly from the platform, but the DEX operating system is unfamiliar to many. In addition, the platform does not provide cryptocurrency storage services, so you will need to additionally register a wallet before buying. However, CAKE can also be purchased on many popular centralized platforms, including those with payment in local currency.
Is PancakeSwap secure?
Using any cryptocurrency exchange poses some risks. There have already been cases in the history of cryptocurrencies where major exchanges have lost millions of user money. A decentralized exchange created by anonymous developers poses more risk than using years of proven centralized exchanges like Binance and Coinbase.
Pros and cons of the service
In the current period, PancakeSwap is one of the most active AMM projects with a large set of services and quite high liquidity. Using Binance Smart Chain gives an advantage over competitors working on Ethereum. If you read the reviews, you can conclude that most customers are satisfied with the exchange. One can work here anonymously, and commissions are lower than on other services.
At first glance, there are no significant disadvantages. However, you need to understand that this is a decentralized platform that uses smart contract technology, so you can’t be in the complete absence of vulnerabilities. Don’t invest more money than you’re willing to lose. No modern blockchain project is immune to bankruptcy or a massive hacker attack. And one more thing, once the updated Ethereum PancakeSwapnetwork is fully operational, it will be harder to compete with Uniswap and other similar projects.
If you want to make some money on farming and staking, then connect to PancakeSwap finance. Judging by the reviews it is quite a reliable project. There is a large selection of pools and you don’t need registration, and the earned coins can be easily exchanged.
The crypto industry is developing more and more, and holders of digital coins have such opportunities, that five years ago could only be dreamed of. Now cryptocurrency can be put into circulation and live on the interest. And this is just the beginning. We live in a very interesting time, a new era of cybereconomics and decentralized finance is emerging before our eyes. The best is yet to come.