The governance overhaul aims to improve liquidity while increasing the value of the CAKE token, which has doubled in the last month.
PancakeSwap, the largest decentralized exchange on the BNB chain, has successfully adopted a proposal that introduces veCAKE (vote-escrowed CAKE) and measures voting in the protocol.
veCAKE closers can vote on governance proposals and route CAKE token issuances to the liquidity pools of their choice.
“This strategic update is intended to give CAKE holders more influence over governance, increase liquidity across all PancakeSwap pools, and increase rewards for CAKE stakers,” PancakeSwap marketing manager Chef Cocoa told The Defiant.
CAKE is up 100% in the last 30 days.
Cake price
Users can lock their CAKE tokens for up to 4 years to receive veCAKE. This model was developed by Curve with veCRV in 2020 and has since been adopted by a variety of DeFi protocols.
At launch, veCAKE holders will be able to vote on farms on Ethereum, the BNB chain and Arbitrum, with support for other chains gradually rolling out.
To ensure the health of the protocol, the team has allocated 40% of the emissions generated by the gauges to provide liquidity for core LP pairs, which include ETH, BTC, BNB, stablecoins and CAKE.
The PancakeSwap team intends to gradually reduce the 40% allocation as more participants become involved in the governance process.
veCAKE holders also have the opportunity to earn “bribes” from third parties by incentivizing certain liquidity pools, similar to Curve and Convex.
Last week, PancakeSwap launched its new gaming marketplace. The platform launched with two titles that the team developed in collaboration with other GameFi studios.
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PancakeSwap is the second largest DEX by volume. According to a Dune query, more than $3.22 billion worth of transactions were processed in the last 7 days.
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