Popular decentralized exchange (DEX) PancakeSwap launched its weekly burn program in early 2023. In the fourth week of the year, PancakeSwap burned up to $109 million of its native $CAKE token.
The PancakeSwap burning program
The number one goal DEX on the BNB chain is designed to combat inflationary pressures on the token.
For this, PancakeSwap, which has long dominated the BNB chain, established its burn program. In total, the decentralized exchange (DEX) has removed more or less 28 million $CAKE tokens by 2023, given the current value of the native token, the price converted to dollars is about $109 million.
A huge number underscoring the importance of the stock market’s anti-inflationary strategy, followed by the $CAKE burn tracker, CryptoEye.
Since Jan. 1, the price of PancakeSwap’s native token has surged nearly 23%, according to CoinMarketCap, reflecting the cryptocurrency’s revival. As of today, PancakeSwap is priced at $4.1, a far cry from its peak of around $42 in May 2021.
But like others cryptocurrencies$CAKE has also gone through a rough patch in 2022, and the token’s price has been heavily impacted by recent crises in the industry.
However, the decentralized exchange strategy seems to be really working; It’s unclear if the burns will continue, but given the positive feedback, we can’t help but expect more burns weekly.
Additionally, the decentralized protocol is helping its user community a lot lately. PancakeSwap helps them get the most out of their crypto assets through trading, through yield farming and also through earning NFTs.
Partly due to its high trading volume, PancakeSwap is confirmed as the leading DEX on the BNB chain.
Past burns from $CAKE
In June last year, the decentralized exchange also tried to start a burn program and managed to eliminate about 7 million CAKE tokens worth $22 million. The token was well below its price today, almost half. To increase deflationary efforts and attempt a price hike, PancakeSwap decided to initiate the burn protocol.
By initiating an incineration process, PancakeSwap developers predicted a reduction in $CAKE’s net emissions.
This made the native token “neutral” or deflationary. PancakeSwap’s burning policy can be found in the company’s white paper.
To further intensify its deflationary efforts, PancakeSwap put forward a proposal on June 13 to increase its buyback and burn allocation to 0.0575%.
With an allocation of 0.0500% at that time, the minutes indicated that the additional 0.0075% would be taken from the Treasury allocation, reducing the allocation of the incoming CAKE trading fee to the Treasury from 0.03% to 0. 0225% would be reduced.
It can be clearly concluded that PancakeSwap is very supportive of cryptocurrency burning. The decentralized exchange platform is undoubtedly a promoter of this “anti-inflationary” solution.
Today it is running a weekly strategy to burn its native $CAKE token and break all personal records on removed tokens. In 2022, it had already tried the same thing, with lower results and equally low returns.
Also in 2021, they had talked about this strategy when prices were at all-time highs, in the event dubbed “The Big Burn” by the platform itself.
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