PancakeSwap Slashes Supply By 300M, Will Token Prices Rise Like Hotcakes?

Author: Murtuza Merchant | December 28, 2023 11:51am

Decentralized exchange PancakeSwap (CRYPTO: CAKE) on Thursday announced a proposal to drastically reduce the supply of its native token.

What Happened: The proposed reduction, amounting to 300 million tokens, will see the maximum token supply slashed from 750 million to 450 million.

The move is aimed at transitioning from a high-inflation model to a more deflationary framework.

The voting process for this critical decision was scheduled to commence at 8:00 am UTC on Dec. 28, 2023, and will remain open for 24 hours.

This decision comes at a time when PancakeSwap has been actively revising its tokenomics and growth strategies, including the recent implementation of the veCAKE Gauges System and the CAKE Tokenomics v2.5.

PancakeSwap stated in a press release that the rationale behind this proposed reduction is multi-faceted.

Firstly, it aims to provide more certainty to the community, which has been observing the platform's development over the past three years.

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Secondly, it is seen as a vital step towards achieving what the team refers to as "ultrasound CAKE," a term indicating a robust and deflationary token.

Lastly, the new cap of 450 million CAKE is deemed sufficient to support the platform's future growth ambitions, which include expanding market share across various blockchain networks and launching new initiatives.

As of now, the circulating supply of CAKE stands at 388 million.

The proposed new cap is expected to be more aligned with the platform's long-term growth targets and market positioning strategies.

If the community votes in favor of this proposal, the reduction in the token supply will be implemented by Jan. 4, 2024.

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Posted In: $CAKE