9 Pancake Swap Questions (Answered & Explained!)

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If you are relatively new to the crypto space, you may have heard of Pancake Swap.

However, you may not know what Pancake Swap is for or how does it work?

In addition to being an exchange, is Pancake Swap a good investment? Is Pancake Swap a Dapp?

I answer these and several other Pancake Swap questions in the post below.

In This Post:

What Is a Pancake Swap?

A pancake swap is a decentralized exchange, which means no central authority manages the system. It means that it’s hard to manipulate the price or shut down the system.

When you trade on a centralized exchange, your funds are stored in wallets controlled by the exchange. When you deposit funds to your wallet, you give control of those funds to the exchange. If you want to withdraw your funds, you must contact support and request a withdrawal.

The pancake swap works differently. Your money stays in possession at all times, and nobody can take it from you or freeze it without your permission (or in case of theft).

A DEX uses smart contracts for trading instead of a third-party escrow service like an exchange would use. Each trade requires one or more transactions on the blockchain, which makes these exchanges slower than centralized ones when there are high volumes of trades being made at once. However, this is not a problem because they have lower fees, and you can always make your trades in a market with low volume.

The pancake swap uses the Ethereum blockchain and smart contracts, so it is a DEX.

Is Pancake Swap a Good Investment?

The Pancake Swap is a new type of DEX. It is not yet available to the public, but it is intended to be used by traders and speculators looking for a way to trade without fees and centralized control.

The pancake swap has some advantages over other DEXs, but it also has some disadvantages that could make it a bad investment:

Low liquidity: The pancake swap will start with very low trading volumes compared to centralized exchanges. At first, the pancake swap will be more expensive than other exchanges for you and your customers. However, as the exchange matures and gains popularity, it may become more competitive.

Low volume: When you use the pancake swap for your trades, nobody else can trade with you simultaneously. It means that when there are high volumes of trades being made on centralized exchanges, there are high volumes of trades being made on the pancake swap, making these exchanges more efficient.

Staking Options: Staking is how you earn a portion of the exchange’s profits. The process is automated, so you don’t need to do anything to get it. It makes the pancake swap very different from other DEXs, which require you to stake manually. Staking cake offers a great opportunity for investors to earn income from the exchange. It’s a great way to earn passive income by continuously earning profits from your investment.

“How much money will I make?” To answer this, let’s take a look at the numbers:

  • To make $10 per month, you need to hold 1% of all the tokens in your wallet. If you have 500 ERC20 tokens in your wallet, you need to keep them there for at least 6 months. It is important to store your ERC20 tokens offline (i.e., on an offline computer or a paper wallet) to not be lost forever if your computer crashes or gets stolen.
  • Let’s assume that you want to stake 2% of all the tokens in your wallet, which would give you $20 per month. If this were possible, then it would allow us to assume that:
  • Holding 2% of your portfolio would allow you to earn $20 per month.

Now, let’s take a look at the numbers:

  • To make $40 per month, you need to hold 4% of all the tokens in your wallet. If you have 500 ERC20 tokens in your wallet, you need to keep them there for at least 6 months. It is important to store your ERC20 tokens offline (i.e., on an offline computer or a paper wallet) to not be lost forever if your computer crashes or gets stolen.
  • Let’s assume that you want to stake 8% of all the tokens in your wallet, which would give you $80 per month. If this were possible, then it would allow us to assume that:
  • Holding 8% of your portfolio would allow you to earn $80 per month.

Therefore, staking is a great way to generate passive income for yourself. The only problem with staking is that the tokens have to be held long. If you want to earn $80 per month, you need to keep your tokens in your wallet for at least 6 months.

Overall, staking is a great way to generate passive income, and you mustn’t keep the tokens in your wallet forever because if they are lost or stolen, the earnings will stop.

To get started with staking, I recommend that you set up an ERC20 wallet (a wallet where you can store any ERC20 token) and then stake as many of your tokens as possible. It will allow you to earn some passive income every month, which will help you make a decent living from Cryptocurrency trading.

Initial Farm Offerings (IFO):

Initial Farm Offerings (IFO) is an upcoming ICO looking to provide a platform for farmers to sell their products and services. The Initial Farm Offering will be backed by gold and silver, giving farmers confidence that they will be paid in full for the products they have sold.

As part of this process, the pancake swap tokens are designed to be used as the currency used within the Initial Farm Offering. The IFO tokens will be used to pay farmers for their produce and services, and this means that farmers will need to have a certain amount of IFO tokens to purchase their products or services.

The IFO tokens are also planned to be an incentive for other farmers who want to join the network and start selling goods on the platform. The more IFO token holders there are on the platform, the higher the price that any farmer will receive for his goods or services. It means that if there are many token holders, then there should be more people willing to purchase goods from other farmers looking for a good deal on their goods and services.

The pancake swap tokens are designed to be exchanged into a fiat currency, giving investors confidence in trading them on exchanges once they have been released.

Another reason to invest in Pancake Swap is Yield farming:

Users can receive a CAKE yield on their LP tokens by investing in a yield farm. It is in addition to the profits made from transaction fees. It is a great way to invest in cryptocurrency without buying or selling any coins.

The yield farm is an actual entity that has been set up in the United States and will be managed by a team of experienced farmers. The team will aim to provide farmers with the best yields possible to make a profit for themselves and receive the most amounts of CAKE tokens for their crops.

It’s important to note that this is not an ICO project, and it’s clear from the whitepaper that it’s designed to help investors generate income from cryptocurrency rather than offering them speculative returns on their investment.

Pancake Swap seems like a solid project, but we’ll need to wait and see if they can deliver on their promises before we can fully endorse them.

How Does the Pancake Swap Work?

The pancake swap is a new kind of decentralized exchange. It is not built on Ethereum’s blockchain; instead, it is built on the Ethereum Virtual Machine (EVM), which is part of the Ethereum blockchain. The EVM allows anyone to send transactions over the blockchain as long as they pay a small fee. To trade on the pancake swap, you will need to learn to use a smart contract. The process is similar to using an ICO smart contract, but instead of using a token issued on Ethereum, you will be using an ERC20 token called the Pancake Token (PCT). The pancake swap works by using two contracts: one contract holds your Ether and Pancakes, and another contract allows you to trade those assets for each other.

When you deposit some Ether into one contract, it automatically creates Pancake in another contract. When you withdraw your Pancakes from one contract, they are deposited into another contract, and your Ether goes back into the first contract that holds it.

There are two main benefits to this approach. The first benefit is that you don’t have to pay any trading fees because no exchanges are involved. The second benefit is that you don’t have to trust anyone with your assets.

The pancake swap works with any ERC-20 token, not just Pancakes, and it uses the simple contract verification method of verifying tokens because it is fast, secure, and easy to implement on the EVM.

How do I use the pancake swap?

All you need to use the pancake swap is an Ethereum wallet that supports ERC-20 tokens (e.g., MyEtherWallet). Then follow these instructions:

  • Create a Pancakes token contract address: 0x7080…d0a8. Send your Pancakes from your old token contract address to the Pancake token contract address.
  • Wait for the swap to be completed (usually within 30 seconds).

You can check the status of your swap by looking at this Etherscan link. 

On the other hand, follow the below steps to use the Meta mask for pancake swapping.

Open Metamask and connect to your account.

  • Step 1: After you connect to your account, click on the “TOKENS” tab and click on “ADD TOKEN.”
  • Step 2: Once you have clicked on ADD TOKEN, paste the contract address of pancakes in the “ADDRESS” box and then click on “ADD.”
  • Step 3: Once you have added pancakes, you can see that Pancakes are added under token balances.
  • To swap your pancakes for tokens, send your pancakes to the pancake contract address. Once you have sent them, you are credited with tokens in seconds. You can check your swap by clicking on the pancake token contract address from where you sent them.
  • Step 4: Once you have checked your swap, you can now withdraw your tokens to any ERC20 compatible wallet.
  • You can also check the status of your swap by hovering over the Pancake token contract address in Metamask.
  • Step 5: Once you have withdrawn your tokens, you will see that the number of pancakes you had before the swap has been reduced by the number of tokens you were given.
  • Step 6: Once you have withdrawn your tokens, you can now send the tokens to any ERC20 compatible wallet.
  • Step 7: You can also check the status of your swap by hovering over the Pancake token contract address in Metamask.
  • Step 8: Once you have withdrawn your tokens, you can now send the tokens to any ERC20 compatible wallet.

That’s it! You have now swapped your pancakes for tokens! You can do this anytime you want to swap your pancakes for tokens. You can also use this method to sell your pancakes to anyone who wants them.

What Is a Pancake Swap Coin?

Pancake Swap coin is a blockchain-based project designed to allow users to swap their pancakes for any other cryptocurrency they wish. A pancake Coin (PCK) is the utility token used to facilitate the trading of pancakes and will be used as a medium of exchange.

The pancake swap platform will use smart contracts and blockchain technology to create a trustless trading environment where users can trade pancakes with any other user, regardless of whether they are friends.

Is Pancake Swap on Coinbase?

No, Pancake Swap is not on Coinbase. However, you can try to buy Pancake swap through these steps;

  • Step 1: Go to coin market cap.
  • Step 2: Click on the “Markets” tab at the top left corner of the page.
  • Step 3: Select all currencies by clicking on “+.”
  • Step 4: Select ‘Cryptocurrency’ tab. step
  • Step 5: Click on ‘Pancake Swap’ at the top of the page.

If you see any listing with Pancake Swap, then it means that there is a market for Pancake Swap coins.

What Exchange Can I Buy Pancake Swap?

You can buy Pancake swap on Binance. You can also buy Pancake swap on Kucoin.

How to buy Pancake Swap from Binance

If you want to buy Pancake Coin (PCK) from Binance, then you will have to follow the following steps;

First of all, you are going to need some Bitcoin or Ethereum. You can use Coinbase or any other exchange to trade for Bitcoin and Ethereum. Once you have your Bitcoin or Ethereum, the next thing you will need is a cryptocurrency wallet. You can download one from many available options online. Once your wallet is downloaded, buying Pancake Coin (PCK) is very simple and easy. You are only going to need a small number of coins to carry out this transaction which makes it very affordable and cost-effective. Here’s how it works;

  • Step 1: Go to Coinbase and purchase some Bitcoin or Ethereum using your bank account or credit card.
  • Step 2: Then, you are going to need to download a digital wallet. You can either download a digital wallet app from the App Store or Google Play Store for your mobile device. If you have an Android mobile device, then download MyEtherWallet. If you have an iPhone or iPad, you will need to download the Coinbase app.
  • Step 3: Once you have downloaded the wallet of your choice, open it and send the purchased cryptocurrency from Coinbase to the wallet address provided to you by Binance.
  • Step 4: Once your transaction has been confirmed on the blockchain. It is ready to be used; transfer that small amount of coins from your digital wallet into your Binance account by logging into your account on their website and clicking on the Funds Management tab.

Pancake Swap from Kucoin

If you want to buy Pancake Coin (PCK) from Kucoin, you will need some Bitcoin or Ethereum to make the transaction. If you don’t have any Bitcoin or Ethereum to make the transaction, you can use one of your other cryptocurrencies available on Kucoin.

BitYard

BitYard is also another platform that is used to exchange pancakes swap. You can use Bityard to swap any cryptocurrency for Ethereum or Bitcoin. You will need to sign up with Bityard by clicking below. After signing up, you will be able to deposit your cryptocurrency and start swapping coins.

Gate i.o

Gate.io is one of the best platforms to swap pancake coins. You can use Gate i.o to exchange any of your digital currency for Ethereum or Bitcoin. You will need to sign up with Gate i.o by clicking here.

After signing up, you will be able to deposit your cryptocurrency and start swapping coins.

If you want to swap pancake coins, you should get some ETH or BTC first. If you don’t have any ETH or BTC, then get some other cryptocurrency available on Kucoin.

What Is Pancake Swap Used For?

Pancake swap is used for Syrup Pools. Syrup Pool is a type of mining pool that allows you to mine cryptocurrencies without buying expensive hardware.

In addition, Pancake Swap is also used for building a trading strategy;

The concept behind pancake swap is to keep the ratio of your cryptocurrency to the cryptocurrency you are swapping. For example, if you have 10 ETH and want to trade 100 BCD for 10 ETH, you should have at least a 1:10 ratio of BCD to ETH. 

That’s why Pancake Swap is also called ‘Pancake Trading.’ Also, you will have to keep the ratio of your cryptocurrency to the cryptocurrency you are swapping. For example, if you have 10 ETH and want to trade 100 BCD for 10 ETH, you should have at least a 1:10 ratio of BCD to ETH. That’s why Pancake Swap is also called ‘Pancake Trading.’

Does Pancake Swap Have an App?

Pancake Swap does not have an app. However, you can use a mobile app called DApps to manage your cryptocurrency.

If you don’t have an Android device, you can also use the MEW Chrome Extension.

To connect Pancake swap with your Trust wallet, follow these steps;

  • Step 1: Tap “Pancake Swap” in the “Popular” section. It’s also included under “Exchanges.”
  • Step 2: Tap “Connect to Trust wallet” in the pop-up window.
  • Step 3: Enter your Trust wallet address and password.
  • Step 4: Enter your Ethereum address.

Congratulations! Your account is connected.

Is Pancake Swap a Dapp?

No, Pancake Swap is not a Dapp. However, you can use DApps to manage your cryptocurrency.

DApps are decentralized applications that run on top of the Ethereum blockchain. Therefore, Pancake Swap is not a Dapp but a decentralized cryptocurrency exchange site where you can trade Ethereum (ETH) for Bitcoin (BCD) and vice versa.

It uses an Ethereum-based token to facilitate the transaction of cryptocurrencies.

Wrapping Up

In conclusion, Pancake swap is a very easy-to-use crypto exchange where you can easily swap Ethereum (ETH) for Bitcoin (BCD). It’s also a decentralized exchange where you can manage your cryptocurrency. 

Pancake swap is a great way for investors since it has low liquidity fees, great yielding farms, etc. It would be best to research more on Pancake swap if you consider joining and investing.

References

  1. https://pancakeswap.finance/
  2. https://academy.binance.com/en/articles/what-is-ethereum
  3. https://coinmarketcap.com/alexandria/article/what-is-pancakeswap