PancakeSwap Review

PancakeSwap 2024 Review: Is it Secure for DeFi Enthusiasts?

TLDR

In this PancakeSwap review, we will explore all the features of PancakeSwap, one of the leading decentralized exchanges globally. Its interface allows for the seamless trading of tokens hosted on the Binance Smart Chain.

Besides, the signup process is straightforward if you already possess a crypto wallet, requiring just a few simple steps. Once registered, you can easily swap tokens or engage in activities like staking and lending to earn interest.

Plus, PancakeSwap offers enticing opportunities to participate in lottery and prediction markets, allowing users to earn the platform’s native CAKE tokens. Interestingly, the platform exclusively supports tokens hosted on the Binance Smart Chain (BEP-20 network), which means that trading popular tokens such as Bitcoin and Litecoin is unavailable.

Who’s PancakeSwap for?

The DEX is an ideal choice for various users; here, we will explain who can benefit most from PancakeSwap.

For new users

PancakeSwap can be suitable for new users, especially those interested in decentralized trading and exploring the world of decentralized finance (DeFi). It caters to those who prefer trading without intermediaries, empowering them to retain control over their tokens throughout the process.

While it may have a learning curve for beginners, PancakeSwap features a user-friendly interface and various educational resources to help users navigate the platform.

Finally, the PancakeSwap community is known for its helpfulness and support, which can benefit newcomers seeking guidance and assistance.

For high-volume traders

Individuals uncomfortable with divulging personal information, as often required by centralized exchanges, can find solace in PancakeSwap’s privacy-oriented approach.

Furthermore, PancakeSwap stands out with its lower trading fees, as it imposes a flat commission of 0.25% per trade, surpassing many rival platforms in terms of affordability.

Lastly, PancakeSwap offers opportunities to earn interest through staking or lending for users looking to maximize their crypto assets. By participating in liquidity pools or lending tokens to other users, individuals can enjoy rewards and interest repayments, enhancing their overall financial returns.

Geographical restrictions

Even though the DEX plans to expand its operations globally, PancakeSwap is subject to regulatory restrictions in certain countries, primarily due to sanctions imposed by the United States.

That’s why residents of the following countries cannot use the protocol.

• Iran
• Cuba
• Iraq
• North Korea
• Sudan
• Syria
• Belarus

What makes Pancakeswap a good choice?

Let’s discuss in this review the most attractive functions of PancakeSwap that make it a perfect choice for crypto enthusiasts.

Usability and design

PancakeSwap offers users a user-friendly interface with diverse financial products and features. While initially based on SushiSwap, PancakeSwap has expanded its services to surpass what SushiSwap currently provides.

PancakeSwap supports multiple languages, including English, Dutch, Spanish, French, Arabic, Russian, and more. Additionally, the platform offers a dark mode setting to reduce screen glare.

From a usability standpoint, one standout feature of PancakeSwap is the ability for users to create personalized profiles on the exchange. Although there is a fee of 1.5 CAKE tokens, users can enjoy the benefits of having a profile and an associated NFT. Profiles allow users to track past transactions and showcase their PancakeSwap NFT collection.

Reasonable fees

PancakeSwap stands out with its notably lower fees than other DEXs, thanks to capped gas fees on the Binance and BNB blockchains, limited to a maximum of $15 per transaction. The transaction fee on PancakeSwap is 0.25%, offering a slightly cheaper option than most other digital asset exchanges. The transaction fee is divided as follows:

• 0.17% is paid to liquidity providers.
• 0.03% is allocated to the PancakeSwap Treasury.
• 0.05% is directed towards CAKE repurchase and burn initiatives.

The treasury funds cover various expenses associated with PancakeSwap’s operation, including salaries, audits, prizes, hosting, upkeep, and bounties. By default, PancakeSwap’s slippage tolerance ranges from 0.5% to 1%, but users can adjust this by clicking on the Settings icon at the top right-hand corner of the PancakeSwap browser.

No KYC requirement

Traditional financial systems are notorious for subjecting clients to extensive, intrusive background checks, compromising their privacy. Performing these checks is compulsory to ensure compliance with regulations like KYC/AML.

In contrast, decentralized exchanges like PancakeSwap prioritize openness and transparency. They incorporate robust security measures and verification features that eliminate the necessity for lengthy KYC procedures. PancakeSwap is an open-source platform accessible to individuals worldwide, regardless of geographical location.

Security of assets

Customers are not required to deposit or withdraw funds from the PancakeSwap exchange. As a non-custodial decentralized exchange (DEX), PancakeSwap facilitates direct peer-to-peer or peer-to-contract transactions.

When users connect their wallets, they can rest assured that they do not need to trust PancakeSwap’s personnel, software, or services, as they never gain control access or utilize them.

Funding and supporting crypto

PancakeSwap does not support fiat currency payments through debit, credit, bank, or any other type of deposit. To engage in investing, trading, or other interactions with PancakeSwap’s exchange and services, it is necessary to have a compatible wallet with BNB (BEP-20) tokens to cover the gas cost.

For transferring ERC-20 tokens from Ethereum or other networks to PancakeSwap, several ERC20 to BEP20 bridge services are available. The most frequently used methods for asset transfers include Binance, Anyswap, and 03 Hub.

Here are some of the supported cryptos:

• BCH
• BTCB
• BNB
• BCH
• ADA
• ATOM
• DOGE
• ETH
• DOT

CAKE tokens

CAKE is the native token of PancakeSwap, the decentralized exchange operating on the Binance Smart Chain (BEP-20). Holders can exchange their tokens for other assets or use token staking to earn rewards.

The primary purpose of CAKE is to enhance liquidity within the PancakeSwap exchange by incentivizing users to stake or lend their holdings and participate in the platform’s lottery program. Approximately 277 million CAKE tokens are in circulation out of a maximum supply of 750 million, giving it a substantial market capitalization of over $3 billion.

Binance bridge

To trade ERC-20 tokens on PancakeSwap, you must wrap them on the Binance Bridge and convert them into BEP-20 assets. Connect your digital wallet to the Binance Bridge and verify the transaction on the Ethereum network, which incurs gas fees.

Although Ethereum’s high gas fees can be costly, once you wrap and bridge your crypto assets to BSC, PancakeSwap’s low fees will significantly reduce your trading expenses.

Once your transactions on PancakeSwap are complete, you can use the Binance Bridge to transfer your BEP-20 assets back to ERC-20. This bridging allows you to utilize the BSC network to purchase tokens like ApeCoin through this bridge.

PancakeSwap Review: Disadvantages

No fiat support

Like most decentralized exchanges (DEXs), PancakeSwap does not support fiat currency deposits. As a result, individuals new to the world of cryptocurrencies and lacking existing crypto holdings cannot trade on this platform. To acquire your initial cryptocurrencies, you must utilize an entry-level exchange that accepts fiat currency deposits.

No customer support

PancakeSwap needs more dedicated customer assistance, which may pose challenges for first-time users or beginners. Currently, it features no dedicated live chat or support for its users. Yet, the platform features a troubleshooting page on its site that addresses issues and provides solutions to rectify them.

Risks on the BNB chain

Investing in Binance Smart Chain tokens carries significant risks. Despite their potential for high returns, many of these altcoins may still need to survive a bear market. Moreover, Binance Smart Chain faces centralization risks as a small group of 21 validators control transactions, mostly affiliated with Binance Exchange.

Unlike Ethereum, where regulatory influence is challenging due to the involvement of thousands of global miners, Binance can delist tokens under regulatory pressure.

Additionally, numerous tokens on the Binance Smart Chain operate as pyramid schemes, needing real-world utility. We recommend you beware of projects claiming to be frictionless yield-farming tokens, as they impose transaction taxes to reward token holders without genuine contributions.

Getting started with PancakeSwap

Unlike the centralized exchanges, PancakeSwap needs no account creation; you must connect your wallet. Here is a step-by-step guide to doing so.

4.5

Read our review

Tradable Coins

• 500+

Fees

• 0.25% fee

Type

• AMM

Get started

More details

PancakeSwap is a top-tier crypto DEX on the Binance Smart Chain (BSC), providing secure and efficient token exchanges. It offers many features, including liquidity pools, staking, trading competitions, and an NFT marketplace. With its fast transactions, low costs, and support for over 500 trading pairs, PancakeSwap is a popular choice.

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  High daily transaction volume.

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  Transaction costs are relatively low.

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  Decentralized liquidity.

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  Perpetual trading contracts with leverage.

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  No dedicated customer support available.

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  Fiat deposits are not accepted.

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  Potential pricing delays.

Step 1: Visit the PancakeSwap website

Navigate to the PancakeSwap website using any web browser on your desktop. Once on the main page, click the [Connect Wallet] button.

Step 2: Choose a wallet

After that, a pop-up will appear on your screen. Select your preferred wallet options. In this case, we will pick Metamask.

Then, approve the connection on your wallet app, and you’ll be redirected to the PancakeSwap URL and signed in using your wallet.

Step 3: Start trading

Congratulations! You are all set. Now you can start trading on PancakeSwap.

What key features does Pancakeswap offer?

When compared to other DEXs PancakeSwap is surely the best in the business.

In this PancakeSwap review, you can find a few key features that set it apart.

Spot trading

PancakeSwap facilitates spot trading by enabling the swapping of assets within a liquidity pool through its automated market maker (AMM) mechanism. Typically, AMM swaps are conducted in real-time based on the pool’s asset ratio, offering users limited control over asset purchase or sale prices.

To address this, PancakeSwap introduces a helpful solution: the limit order function. Unlike centralized exchanges, this feature doesn’t require matching orders. Instead, once the pre-set price target is reached, the AMM executes a swap within its liquidity pool.

However, the limit orders are unavailable for tokens with transfer fees or taxes. These open limit orders remain active until executed or canceled by users, with a customizable expiration date feature planned for future updates.

Furthermore, PancakeSwap’s utilization of the Binance Smart Chain (BSC) network ensures faster and more cost-effective transaction speeds than Ethereum. Using the V2 swap option for optimal trading results is advisable, as the older V1 version may be susceptible to slippage, potentially resulting in capital loss.

Token Swapping

At PancakeSwap, conducting token swaps is a seamless process facilitated by automated liquidity pools. Traders can effortlessly exchange their BEP-20 tokens by utilizing limit orders, which enable them to specify desired prices and instruct the system to fill buy or sell orders accordingly.

These limit orders, also known as stop-limit orders, will only be executed (or improved) if the price on PancakeSwap reaches the designated limit price.

This user-friendly feature empowers traders to secure swaps at their preferred prices, enhancing their trading experience on the platform and making it an excellent choice for crypto enthusiasts.

Providing Liquidity

PancakeSwap allows users to trade digital currencies using an innovative decentralized method called an Automated Market Maker (AMM). Unlike traditional centralized platforms, PancakeSwap provides DeFi farming benefits to liquidity providers and allows for customized liquidity pools.

Syrup Pools

Within PancakeSwap, Syrup Pools enable users to deposit CAKE and receive rewards through CAKE or other tokens. The CAKE Syrup Pool allows users to choose between flexible and locked staking. Opting for locked staking entails a higher Annual Percentage Yield (APY) but necessitates locking the tokens for a specific duration.

On the other hand, flexible staking provides a comparatively lower APY but grants users the freedom to withdraw their tokens at any time they desire. This flexibility allows you to customize your staking strategy to match your unique needs and preferences perfectly.

Flexible Staking

Traders can participate in PancakeSwap’s Syrup Pools by staking CAKE tokens, offering flexible and fixed staking options. To get started, they need to connect their wallet to the pool on the Pools page. Flexible and Fixed staking options replace the Enable button.

With flexible staking, users can unstake their tokens from a syrup pool at any time, albeit with a fee if done within 72 hours. After three days, they can unstake without a fee. The 3-day timer resets with additional CAKE added to the pool. This fee applies only to manual unstacking and not to automatic compounding.

Instead of unstacking, users can harvest profits from the liquidity pool. Each time they harvest from a syrup pool, a 2% fee is automatically deducted. Weekly, a portion of the acquired CAKE tokens through unstacking and performance fees is burned to reduce token inflation.

This burning process reduces the total number of circulating tokens. Additionally, users can automatically retake earnings from a flexible pool into a fixed-term pool, but not vice versa.

Yield Farming

Users can earn CAKE tokens by participating in liquidity farming on PancakeSwap. To engage in yield farming, users must provide liquidity to the Liquidity Pools and stake two tokens to receive the corresponding LP tokens for a specific farm.

Each farm on PancakeSwap offers its unique yield rate and multiplier, so reviewing and selecting the desired farm before providing liquidity is essential.

For instance, the CAKE-BNB farm boasts a 40x multiplier. This implies that the farm receives 40 CAKE tokens for every block generated as a reward. Explore the various farms available to maximize your earning potential on PancakeSwap.

Perpetual Token Trading

Futures trading platforms allow users to trade on margin or leverage, allowing them to utilize borrowed funds to maximize their trading capital. With leverage, users can enter positions that exceed their account balance, amplifying potential gains or losses.

Additionally, PancakeSwap’s futures markets support long (buying) and short (selling) positions on perpetual contracts. This expands the range of tradable assets, including those not currently available on the Binance Smart Chain (BSC). Perpetual contracts, which do not have expiration dates, enable traders to profit from price movements without owning the underlying asset.

Furthermore, PancakeSwap leverages this feature to expand its trading offerings by including additional assets not yet available on the BSC. With perpetual contracts, traders can participate in price changes without owning the underlying asset, even if the contract has no fixed expiration date.

Participate in the PancakeSwap Lottery

PancakeSwap regularly hosts lottery programs allowing users to win substantial CAKE tokens. By purchasing lottery tickets with CAKE tokens, each priced at approximately $5 worth of CAKE, participants can select their ticket numbers manually or opt for a random selection.

In the fortunate event of being the chosen winner, individuals can receive CAKE tokens valued at hundreds of thousands of dollars. These enticing lotteries present a thrilling chance for users to secure significant rewards within the PancakeSwap ecosystem potentially.

Predictions betting

PancakeSwap offers a prediction market where users can bet on token pairs’ price movements. By participating in this market, such as for BNB and CAKE tokens, users can predict whether the price will be higher or lower at a specified future time. To join, users contribute tokens to the prize pool.

If their bet is correct, they can earn rewards multiple times greater than their initial contribution to the prize pool. This exciting feature adds another layer of engagement and potential rewards for users on PancakeSwap.

PancakeSwap Initial Farm Offering (IFO)

Participating in Initial Farm Offerings (IFOs) on PancakeSwap provides users a unique opportunity to gain early access to newly added tokens.

To join an IFO, users must exchange their CAKE tokens for iCAKE, the designated currency for purchasing new tokens through farm offerings. This exclusive feature allows users to enter the market early and benefit from future profits.

By leveraging IFOs, users can seize the potential for significant returns by being part of the initial token launch on PancakeSwap.

NFT Marketplace

To maintain its competitive edge, PancakeSwap has taken a step forward by introducing its exclusive NFT collections and enabling users to create customized profiles by associating them with NFTs.

Additionally, PancakeSwap boasts its own NFT marketplace dedicated to trading allowed NFT collections. Users can acquire NFTs by engaging in team trading games, where traders vie to achieve the highest trading volume within a specified period.

Furthermore, PancakeSwap organizes airdrop events where NFTs can also be obtained. These initiatives provide users with exciting avenues to explore and collect unique digital assets within the PancakeSwap ecosystem.

Fixed-Term staking

PancakeSwap offers Fixed-Term Staking as another option to stake CAKE or other BSC tokens and earn CAKE rewards. Users can lock their CAKE in fixed-term staking and extend the lock duration by adding more CAKE.

The maximum lock-up period is 52 weeks, with longer locks yielding more significant rewards. However, users cannot decrease the lock duration or switch from fixed to flexible staking until the lock period ends. Additionally, they cannot withdraw tokens or harvest rewards until the fixed lock period expires.

PancakeSwap Review: Room for improvement

PancakeSwap boasts a vibrant and supportive community, evident in the active user base that readily offers help to new users. To access support, users can rely on Telegram or Reddit for assistance.

It should consider establishing an official customer support channel or helpdesk to assist users, particularly those requiring personalized guidance or troubleshooting.

PancakeSwap Review: Conclusion

PancakeSwap provides a user-friendly interface, low transaction fees, and various liquidity pools for yielding farming rewards. While investing in PancakeSwap carries risks like cryptocurrency price volatility and technical issues, many view it as a promising long-term investment due to the growth potential of its native token, CAKE, and the platform’s market position.

To ensure safety, PancakeSwap has enforced measures like audits and bug bounties to guarantee platform security. You can optimize their experience on this decentralized exchange by sticking to best practices and minimizing fees.

We recommend our readers explore PancakeSwap themselves. With its intuitive interface, low fees, and high returns, PancakeSwap is an appealing DEX for those interested in decentralized finance.