PancakeSwap Pushes CAKE Towards Deflationary Tokenomics With New Community Vote

The number of CAKE tokens per block sent to PancakeSwap’s Syrup Pool to be reduced.

PancakeSwap Community Votes for More Deflation

With a 56.83% dominance, PancakeSwap, the leading decentralized finance (DeFi) protocol on BNB Chain, in a recent proposal to its community members, sought the reduction of CAKE emissions. The CAKE Emission Reduction proposal aimed to reduce token emissions in the protocol’s Syrup Pool

Put simply, “emission” refers to the rate at which tokens of a crypto asset are created or distributed. 

Under PancakeSwap’s previous tokenomics, 40 new CAKE tokens were emitted per block. Of these, 10 CAKE tokens were sent to its Syrup pool, and 3.75 CAKE were sent to its farms. The rest were burned. With the new proposal, PanCakeSwap’s objective was to reduce the number of CAKE tokens sent to its Syrup Pools by either 2.5%, 5%, or 10%.

Speaking on the objective of the proposal, Chef Icy told BSC News that:

“Eventually, we are aiming for emissions-neutral or even deflationary, so reducing emissions per block better helps to achieve that. We have already reduced emissions via other methods (e.g., farm rewards have been cut by 87.5%) and increased burn (increase trading fee CAKE buyback-and-burns), so enabling us to reduce emissions to pool is critical.”

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The proposal to reduce its emissions was driven primarily by the protocol’s desire to pursue a sustainable growth model away from its “growth-at-all-costs model.” With the emissions reduction, PancakeSwap seeks to ensure that the supply of CAKE tokens is under control while growing its organic adoption in the DeFi space.

Confirming that the proposed reduction will lead to a decreased APR/APY for its users, Chef Icy added further that:

“Yes, they would receive a lower APR/APY. But the benefit accrued to them having a less-inflationary token outweighs the decrease in APY.”

 At the end of the voting period on August 11, 75.97% of the total votes cast favored a 10% reduction in CAKE emissions to the protocol’s Syrup Pool.

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What is PancakeSwap:

PancakeSwap is a Decentralized Exchange (DEX) built on BNB Chain. It offers users various features such as Liquidity Pools, Swapping, Yield Farming, Syrup Pools, Automated Market Maker, Initial Farm Offering (IFO), NFT profile system, and many others. 

In addition, the protocol helps users make the most out of their crypto assets by trading, earning through yield farming, and winning via lottery, prediction, and NFT collectibles. With the highest trading volumes in the market, PancakeSwap is the leading DEX on the BNB Chain. 

Where to find PancakeSwap: 

Website | Twitter | Medium | GitHub

Source : bsc.news

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