CAKE down 21% as PancakeSwap mulls slashing staking rewards

  • PancakeSwap is a decentralized exchange (DEX) built on the BNB Chain.
  • PancakeSwap (CAKE) has dropped by 21% over the last seven days.
  • The DEX’s core team introduced a proposal to reduce the token’s inflation rate to 3-5%.

PancakeSwap’s native token, CAKE, has declined by about 21% in the last seven days and 27% in the last 14 days despite PancakeSwap’s core team introducing a proposal to reduce the token’s inflation rate to 3-5% from the current rates above 20%.

While the crypto market suffered from the recent bear market across the board, the CAKE token was expected to ride on the proposed inflation-reducing proposal rather than drop. On the contrary, the token has been dropping as stakers move out in numbers.

At press time, CAKE was trading at $2.66, up 1.6% over the last 24 hours.

Reducing PancakeSwap token inflation rate

PancakeSwap recently forked Uniswap V3’s code and launched its version on Aptos and Ethereum. The project’s core team has also introduced a proposal to reduce the native token’s inflation rate to 3-5% from the current rates above 20%.

If the proposal is passed, it will see the amount of tokens that stakers earn lowered something that could be the reason behind the recent exodus of stakers from PancakeSwap.

But why should the team suggest a proposal that is detrimental to the project’s ecosystem? Well, the proposal reads:

“Current inflation rates are unsustainable for CAKE over the long term, and reductions are required for the long-term health of PancakeSwap.”

Voting on the proposal already began on April 26 and it is scheduled to end today April 28. So far, the numbers show that the community is in support of the aggressive proposal. 55.43% have voted for the proposal compared to only 8.10% who have voted against the proposal although the voting process is still open.

Source link

Be the first to comment

Leave a Reply

Your email address will not be published.