Binance’s BSC network backed biggest decentralized exchange decided to reduce the emission rate of its native token.

Pancakeswap exchange is a decentralized exchange in the Binance’s BNB chain ecosystem. Exchange is getting an advantage because of its first mover step in the BNB chain ecosystem and high rewards in pool with its Cake token, the native token of the exchange. Cake token is currently standing at 73rd rank in the crypto industry, by 24 hours trade volume. 

On 23 June, Pancakeswap proposed to bring changes in its Cake token issuance rate. The team urged the platform users to vote on whether they wanted a change in the cake token emission rate or not. 

The team providesld three options to choose for the votes. The first option is to do nothing with the issuance rate while another two options are to reduce the 0.25 cake per block & 0.5 Cake per Block.

At the time of writing this article, 92.33% of people voted in favor to reduce 0.5 cakes per block, which means an 11.76% reduction rate in the inflation, or we can say an expected 12% reduction in the pool reward rate. 

Almost 95% people want Pancakeswap to reduce token emission 1

Reason to reduce Cake emission

Pancakeswap also explained the main reason behind this proposal. According to Pancakeswap, it will reduce inflation and make Cake a deflationary coin but at the same time team admitted that it will impact the liquidity on its platform. 

Because of the reduction in the pool reward, the majority of the liquidity providers will try to shift to other high-yield pools. 

After the collapse of the Terra ecosystem, the majority of the crypto proponents criticized high reward & high yield provider platforms. Even Binance CEO Changpeng Zhao said criticized Terra’s high reward on Terra’ UST holding. 

Price action

Due to this proposal, significant increment in the price of Cake token has not been seen yet. At the time of writing, this article, price of the Cake is $3.24.

Read also: Ripple Exec says Crypto presents an incredible opportunity for engineers to solve problems


Source link


Comments are closed.