Summary

Another DeFi protocol named after food? That's right. PancakeSwap is a decentralized exchange (DEX) built on Binance Smart Chain, and its anonymous developers have a soft spot for breakfast foods and bunnies.

Pancakeswap is somewhat similar to Ethereum’s SushiSwap (community governance, which is to obtain liquidity provider tokens through mining), but Many other features have been added that allow users to earn rewards.

Foreword

For months, various mining crazes named after food have attracted many players in the digital currency field. In the latest wave of DeFi protocols, we have witnessed many platforms springing up. These platforms allow users to stake funds in exchange for tokens in the protocol.

Most of this activity is concentrated on the Ethereum blockchain. As one of the first blockchains to support smart contracts, Ethereum has a large user base, developers, and tools to build powerful decentralized applications.

This article will introduce PancakeSwap, a decentralized exchange built on Binance Smart Chain (BSC) platform.

What is PancakeSwap?

PancakeSwap is a decentralized trading platform for trading BEP20 tokens.

User interface of Pancakeswap trading platform.

Already a Uniswap or SushiSwap veteran? That couldn't be better! The core design of PancakeSwap is very similar to the two platforms mentioned above, so you will definitely be able to use it easily.

Pancakeswap trading platform

PancakeSwap uses the Automated Market Maker (AMM) model. This indicates that although digital assets can be traded through the platform, the platform does not provide an order book to match orders. Instead, users trade against liquidity pools.

These fund pools accumulate funds from other users. Users deposit funds into the pool and receive tokens from liquidity providers (i.e. “LPs”). They can then use these tokens to exchange for their share of the funds and earn a portion of the transaction fees.

So, in short, you can trade BEP-20 tokens and also earn rewards by adding liquidity. We will introduce other functions later.

LP tokens come in various types – for example, you will receive BUSD after adding BUSD and Binance Coin to the pool -BNB LP tokens in return. If you add BETH and ETH to the pool, you will receive BETH-ETH LP tokens.

Mining and staking with PancakeSwap

Don’t worry, there are more features waiting for you Dig! PancakeSwap also allows users to obtain its governance token, CAKE, through mining.

It must feel good!

You can deposit LP tokens into the mine. In the process of locking these tokens, you can also earn CAKE rewards. Want to know which LP tokens can be deposited? There are many types, here are just some of the most popular coins:

• CAKE – BNB LP

• BUSD – BNB LP

• BETH – ETH LP

• USDT – BUSD LP

• USDC – BUSD LP

• DAI – BUSD LP

• LINK – BUSD LP

• TWT – BNB LP

Is this the end of the rewards? Not really! You can earn more by staking CAKE held in the SYRUP mining pool.

Now you have received LP tokens by depositing funds and used them for CAKE mining. Next, CAKE tokens can be staked and other tokens earned through a special staking protocol.

The largest SYRUP mining pool is exclusive to CAKE. Here, you can earn more CAKE by staking your existing CAKE! But there are many types of tokens you can earn by staking CAKE, so be sure to pay attention to the SYRUP mining pool page.

Use PancakeSwap

If you visit https://pancakeswap.finance, you will notice that many features are unavailable until you click "Unlock Wallet". After clicking, multiple options will be displayed on the screen: Metamask, Trust Wallet, WalletConnect and Binance Chain Wallet, etc.

You may ask, isn't MetaMask an Ethereum wallet?

Indeed, but the Binance Smart Chain architecture supports users to use MetaMask to interact with BSC-based DApps. If you choose to use MetaMask, it is recommended to read the relevant guide: "Connecting MetaMask and Binance Smart Chain".

After setting up, you can unlock the wallet and view more information. You will see various LP tokens corresponding to different rates of return. So, how can you add liquidity?

Add liquidity

If you have used any automated market maker (AMM) before, you must be familiar with the operations. Before obtaining CAKE through mining, you first need to add liquidity to the trading platform.

Browse to "Trading" on the left sidebar and click on "Liquidity", then click on "Add Liquidity" and select the desired Deposited token pair. Additionally, impermanent losses must be understood before adding liquidity to a pool.

Add liquidity to PancakeSwap.

Mining

Now that you have obtained LP tokens, you can stake them to earn CAKE. Browse the mine tab and select the option that matches the LP tokens you hold.

Same as ERC-20 tokens, you need to approve the movement of BEP-20 tokens, only then can the contract act on your behalf Make a withdrawal. Once you click "Approve Contract," a dialog box will pop up asking you to confirm the transaction and display the fee.

After the transaction is confirmed, select the amount you wish to pledge and confirm the operation. After the operation is completed, you can exit this page. You can go back at any time to see how much CAKE you have earned. If you wish to harvest your rewards, click "Harvest" and confirm the transaction.

➟ Want to start a digital currency journey? Welcome to Binance to buy Binance Coin!

Pledge

After obtaining CAKE, you can stake it into the SYRUP mining pool. Visit the Pools tab and the screen will show the pools that can accept CAKE collateral.

SYRUP Mining Pool—Stake CAKE to earn new tokens.

At this time, you need to approve the withdrawal of the tokens you hold again. Click "Approve CAKE" to complete the operation. Once approved, you should select the amount of CAKE you need to stake.

After successfully staking CAKE, you will passively earn reward tokens generated by the mining pool. To redeem your rewards, click "Reap".

Lottery

Those functions just now are great! What else can I do with CAKE? You can also buy lottery tickets on Pancakeswap.

Buy PancakeSwap lottery tickets and try your luck.

Each draw will take place 6 hours apart. Each lottery ticket costs 10 CAKE and provides a four-digit random number combination consisting of any four numbers from 1 to 14, such as 12-8-4-3. To win the jackpot (up to 50% of the entire prize pool), the combination of numbers in the ticket must match the winning numbers, and the numbers and positions must exactly match.

What happens if the four numbers don't match exactly? no need to worry. As long as two or more numbers are in the same position as the numbers in the winning ticket, you win the prize.

Non-Fungible Token (NFT)

What, can PancakeSwap bring you more surprises? Yes, you can also win special NFTs.

The NFTs provided by Binance Smart Chain (BSC) are so cute, come and try your luck.

After winning a non-fungible token (NFT), you can exchange it for CAKE tokens of equal value, or exchange it for This "little cutie" slips into your wallet as a collectible.

How to participate in the lottery? Register to get the chance to win! The winner will be selected at random. Be sure to keep an eye on the NFT page to take advantage of upcoming opportunities.

Join a team and create a profile

Looking for more ways to play? Consider joining a team and creating a profile. You can create a public profile to showcase your data and join a team to collaborate with teammates and compete for team achievements!

Initial Mining Offering (IFO)

Initial Mining Offering (IFO) is a way to issue new tokens to users with the help of liquidity mining. In PancakeSwap, you can submit LP tokens obtained from supported mining pools and get the opportunity to purchase new tokens.

Please visit the IFO page to view the currently valid IFO in PancakeSwap.

Is PancakeSwap safe?

PancakeSwap has passed the CertiK audit.

Does this mean there are no security issues at all? Not really. As long as funds are deposited into smart contracts, there is always the risk of vulnerabilities, even for projects that have passed audits and are reputable. Therefore, never deposit more than your personal risk tolerance.

Summary

PancakeSwap is the largest automated market maker (AMM) project in Binance Smart Chain (BSC), providing multiple innovative features. You can also track more indicators about PancakeSwap at https://pancakeswap.info/.

Ethereum may be an early promoter of the DeFi trend, but judging from the development of projects such as PancakeSwap, the wave of technological innovation Destined to flock to blockchains other than Ethereum.