Centralized and decentralized exchanges are ramping up their game, with the imminent launch of Uniswap v3, competition in the industry is bound to be fierce. The second iteration of PancakeSwap is also around the corner. CAKE holders will be able to take advantage of this.
In a recent to vote, The PancakeSwap community decided to approve a feature called the “Big Burn”. Therefore after April 23rd Great Migration, the exchange will buy back and burn more CAKE than ever before. Every transaction in PancakeSwap v2 will “contribute” to this mechanism.
The exchange’s daily trading volume is around $ 4 billion. According to the recently approved combustion mechanism, this figure will be multiplied by 0.05%. As a result, about 2.2 million CAKE could be bought back and burned every day. If PancakeSwap maintains its current daily trading volume, the original token buying pressure could skyrocket in the favor of investors.
Analyst Vivian Medithi published an article on Nasdaq that made some optimistic predictions about CAKE. At the time, CAKE was trading at $ 21.26 after rallying 1,200% year-to-date in February. The analyst highlighted some investors’ bearish sentiment and the token’s ability to prove them wrong.
Medithi cites Coinpedia, Wallet Investor and Digital Coin to support a bullish case for this token. The predictions place CAKE between $ 44 and 80 by the end of 2021. Next year, CAKE could trade for $ 150 and $ 280 by 2026. These predictions were made before the “Big Burn” was approved and do not take into account the new potential. increase. when buying pressure.
What is PancakeSwap “Great Migration”?
Tomorrow at 05:00 UTC the “Great Migration” will take place on PancakeSwap. Due to the upcoming update, the exchange’s smart contract PancakeSwap Router and PancakeSwap Factory required a change in their feed structure. CAKE holders can vote to change this section.
They were offered 4 options: Split (increase fee to 0.22%), Burn (0.22%), Big Split (0.25%) and Big Burn (0.25%). As mentioned, users chose the latter, which also offers a 0.17% fee to liquidity providers and keeps PancakeSwap’s fee below the “traditional 0.3%” used by their competitors, according to an official post. The migration also adds the following:
(…) We are creating a new set of LP tokens, and our farms and exchange will start to support the new type instead of the old one.
Investors with tokens on this exchange should be aware that they will no longer receive rewards for the ‘old type of LP tokens. Instead, the rewards will shift to the new one. Users will have to take their tokens out of all PancakeSwap’s products and add liquidity with the new token to re-wager on new farms to keep their rewards. The team behind the exchange added:
We will also create a new set of farms with the same rewards and token pairs as the old one. The old farms will no longer give out rewards, so you have to switch to the new ones to maintain the agricultural yield.
CAKE is trading at $ 26.85 with a loss of 2.9% on the daily chart. In the weekly and monthly chart, CAKE has 17.1% and 144.9% profit respectively.