PancakeSwap Proposes 40% Supply Reduction, CAKE "Pumps" 25%
This move can be seen as one of PancakeSwap's efforts to reduce CAKE token inflation rate annually to just 3 - 5%.
PancakeSwap Proposes 40% Supply Reduction, CAKE "Pumps" 25%
On the afternoon of December 21, 2023, PancakeSwap, the leading DEX platform on the BNB Chain ecosystem, proposed adjusting the total supply of CAKE tokens from the current 750 million to 450 million, marking a 40% reduction.
This initiative is part of a plan to reduce CAKE's annual inflation rate to only 3 - 5%, aligning with the "ultrasound CAKE" journey to transition PancakeSwap's tokenomics to a long-term deflationary model.
🐰 PancakeSwap Family!
— PancakeSwap v4 (@PancakeSwap) December 21, 2023
🥞 We are proposing to reduce the max token supply of $CAKE from 750M to 450M.
💥 After a year of hard work and deflation, we are razor-focused on ultrasound CAKE.
🌟 By reducing our token supply by 300,000,000 $CAKE, we signal PancakeSwap’s successful… pic.twitter.com/PIk3SBEhiJ
Launched in 2020, PancakeSwap is currently the second-largest decentralized trading platform by volume and market share, following only Uniswap. Over the past year, PancakeSwap has significantly revamped its tokenomics model, focusing not only on issuance but also on development strategies.
From improving CAKE v2.5 tokenomics, introducing the veCAKE model, launching a gaming marketplace, to integrating products across multiple networks like Base, Linea, Arbitrum One, and zkSync Era. Additionally, this DEX platform shares transaction fee revenue with CAKE holders.
Following the supply reduction news, the CAKE price responded positively, recording an increase of over 25% on the 4H chart on Binance. At the time of writing, CAKE is trading around $2.5, showing significant growth from $2.2 before the announcement.
4H chart of CAKE/USDT pair on Binance at 06:15 PM on December 21, 2023
