Learn more about the BNB Chain decentralized exchange and NFT marketplace
Have you ever wanted to jump into the world of DeFi and NFTs but don’t know how to begin? This blog post will introduce you to one of the best tools to get started. What is PancakeSwap? Think of it as a platform that makes it easier for beginners to understand and take part in cryptocurrency opportunities. So read on to learn more about how to use PancakeSwap!
What is PancakeSwap?
PancakeSwap is one of the largest Decentralized Exchanges (DEX) and NFT Marketplaces built on the BNB Chain.
While its goal is to make it easy for people to get involved in DeFi and NFTs, PancakeSwap has also become one of the most popular DeFi platforms in the space.
It was first launched in September 2020, but, as you can see in the DappRadar Top BNB Chain DeFi Dapps, PancakeSwap is still one of the most used exchanges.
In July 2022, PancakeSwap’s total volume was $2.16B, with over 2 million monthly users.
What is PancakeSwap’s CAKE Token?
The CAKE token is PancakeSwap’s native token, and it serves several purposes. You can use it to pay transaction fees, earn rewards for providing liquidity, and even vote on PancakeSwap governance proposals!
As you can check out on DappRadar’s Token Explorer, CAKE’s all-time-high value was at $42.46 in April of 2021, while the all-time low was at $0.22 in September 2020. At the time of writing, July 2022, CAKE’s price value stood at $3.38.
If you are interested in learning more about this, check out our article PancakeSwap and Its Native CAKE Token.
Users can trade CAKE on PancakeSwap or other exchanges that support Binance Smart Chain assets, like the DappRadar Token Swap.
What can I do with PancakeSwap?
One of the great things about PancakeSwap is that there’s something for everyone. Whether you’re interested in DeFi, NFTs, or both, PancakeSwap has you covered. Here are the main ways you can benefit from using PancakeSwap:
PancakeSwap: The Decentralized Exchange
PancakeSwap’s first and main product is its DEX powered by its community.
A DEX is an exchange that doesn’t rely on a central authority. This means that PancakeSwap is censorship-resistant and can’t be easily shut down by any government or corporation.
Also, unlike centralized exchanges like Binance or Coinbase, PancakeSwap does not hold your funds. This means that you completely control your coins, trading directly from your digital wallet.
The PancakeSwap DEX uses an Automated Market Maker (AMM) model, with no order book to match buyers and sellers. Instead, it uses Liquidity Pools to provide a fair trading experience with low fees.
We’ll explain in much more detail how you can benefit from PancakeSwap’s outstanding Decentralized Finance (DeFi) products later in the article.
PancakeSwap: The NFT Marketplace
In addition to its DEX, PancakeSwap also has an NFT marketplace, launched very successfully in September 2021.
An NFT is a non-fungible token, which means it’s a unique digital asset that another asset can’t replace. The PancakeSwap NFT marketplace allows you to buy and sell these digital assets with a friendly user experience.
PancakeSwap’s NFT marketplace is powered by the BNB Chain and allows you to buy, sell, or trade PancakeSwap-specific NFTs with very low transaction fees.
Although not as famous as NFTs on the Ethereum blockchain, BNB Chain NFTs are rapidly growing in interest amongst collectors.
How to start using PancakeSwap?
Now that you know a little more about PancakeSwap let’s dive into how to use it!
Connecting Your Wallet
Before you can do anything on PancakeSwap, you’ll need to connect your digital wallet. PancakeSwap supports a wide range of wallets, including MetaMask, Opera Wallet, Blocto, SafePal, and others.
If you don’t have a digital wallet yet, we recommend checking out our video below about them and how to choose one.
Once you’ve created your wallet, all you need to do is click on the “Connect Wallet” button on the PancakeSwap website and follow the instructions. After connecting your wallet, you’re ready to start!
How to trade and generate passive income with PancakeSwap?
Now that you’re all set up, it’s time to start PancakeSwap’s main product: the Decentralized Exchange.
Trading tokens in PancakeSwap is a fairly easy experience. Once your wallet is connected, and your tokens are ready, you just have to choose your amounts and swap!
You will have to pay a 0.25% trading fee for each swap, and the transaction will be available for view on the BscScan explorer.
As we mentioned before, PancakeSwap is a DEX that uses Liquidity Pools (LPs) composed of funds provided by several users.
These LPs are created when users deposit their tokens into the PancakeSwap smart contract. In return, they receive LP Tokens that represent their share of that pool.
For example, if you deposit 100 BNB into the CAKE/BNB LP, you will receive 100 CAKE-BNB LP Tokens. These tokens can be traded on PancakeSwap or other exchanges for other BNB Chain assets.
Staking CAKE with Syrup Pools
PancakeSwap has what are called “Syrup Pools”, which are very similar to LPs, but with one main difference: the rewards are in CAKE, PancakeSwap’s native token.
They are basically staking pools that offer liquidity providers an additional way to earn rewards.
You can also earn PancakeSwap’s CAKE token by staking your LP Tokens. For every trade that happens in a pool you provide liquidity to, you will receive a small amount of CAKE as a reward.
This is what’s called Yield Farming, and it’s one of the main ways users can earn passive income on PancakeSwap.
It’s important to point out, however, that these rewards don’t come without risks. Providing liquidity means you are exposed to impermanent loss – and permanent loss.
- Read further: How to Make Passive Income on PancakeSwap
How to buy and sell NFTs on PancakeSwap?
PancakeSwap’s latest launch, the NFT Marketplace, allows users to buy and sell non-fungible tokens on BNB Smart Chain. With great UX and transparent processes, this is one of the best NFT marketplaces out there.
Buying NFTs on PancakeSwap
To buy an NFT on PancakeSwap, all you need to do is find the one collection and token desired, check the item details and price, and click “Buy”. You will then be prompted to confirm the transaction with your connected wallet.
Once the transaction is confirmed, PancakeSwap will add the NFT to your wallet.
Each transaction on the PancakeSwap NFT marketplace comes with a trading fee of 2%, used to buy back and burn CAKE tokens.
Selling NFTs on PancakeSwap
To sell an NFT on PancakeSwap, you’ll first need to get your collection whitelisted. If your application is accepted, then you can list your NFTs for sale on the marketplace.
Some things will definitely help your NFT collection get listed on PancakeSwap, like having all the NFTs minted. If your project has an active website and social media accounts, it shows that your collection has an engaged community and a strong business plan, being worthy of PancakeSwap.
PancakeSwap’s official NFT collections and profiles
In addition to user-created collections, PancakeSwap also has its own official NFT collections. These include the Pancake Squad Collection and the Pancake Bunnies Collection.
Furthermore, users on PancakeSwap can create their own NFT user profiles, totally personalized. By allowing users to choose their names, teams, and NFT profile image, the marketplace creates a community-driven environment – not yet common amongst NFT marketplaces.
Track PancakeSwap with DappRadar
In case you’re looking for a better way to manage your crypto and NFT portfolio, you have to check out the DappRadar Portfolio Tracker.
DappRadar will continue to monitor numbers and news on PancakeSwap’s DEX and NFT marketplace. If you are interested in learning more about this and other important web3 projects, make sure to check out our blog, Youtube, and Twitter.
The above does not constitute investment advice. The information given here is purely for informational purposes only. Please exercise due diligence and do your research.