PancakeSwap Review 2022: Fees, Pros, Cons, and Features

PancakeSwap is one of the most popular decentralized exchanges, with nearly $4 billion in total value locked (TVL). We’ll dive deep into the platform and its features to help you decide if it’s a suitable exchange for you.

  • November 7, 2022
  • 9 Min Read

Our Take on PancakeSwap

4.6
DeFi Rate Rating

The Bottom Line

PancakeSwap is a decentralized exchange that lets you trade with lower fees than many rival exchanges. It also lets you earn interest on your crypto assets by staking or lending them. However, its main drawback is that it only supports tokens hosted on the Binance Smart Chain. PancakeSwap also does not offer a mobile app version of the platform.

In this article, we'll take you deep into the details on PancakeSwap, the well-known decentralized exchange. Let's dive into the platform and its trading, lending, and NFT features.

What is PancakeSwap?

PancakeSwap is an exchange that lets you swap Binance Smart Chain tokens with ease. The exchange is decentralized, meaning users keep control of the private keys to their tokens when transacting on the platform. This way, you’ll still have your tokens even if anything goes wrong with PancakeSwap, unlike when using centralized exchanges.

Minimum trade amount$1
Trading fees0.25%
Trading pair options BUSD/USDT, USDC/BUSD, WBNB/USDT, BTPD/USDT, and 3,000+ others
Supported assetsBEP-20 tokens (BNB, BUSD, USDT, USDC, and many more)
Can you use your crypto wallet?Yes - MetaMask, Binance Smart Wallet, Trust Wallet, and many others
Mobile app?No
Customer serviceTelegram channel

PancakeSwap Pros and Cons

Pros

  • Intuitive interface
  • You control the private keys to your tokens
  • Supports staking

Cons

  • No mobile app
  • You can’t trade BTC and other non-BEP-20 tokens
  • No native crypto wallet

PancakeSwap is Best for:

  • Users who prefer trading without intermediaries and keeping control of their tokens
  • People who aren’t comfortable with giving up identifying information as required by centralized exchanges
  • People who want to trade with lower fees; PancakeSwap takes a flat commission of 0.25% on every trade, much smaller than many rival exchanges
  • Users who want to earn interest on their crypto assets by staking or lending them; PancakeSwap lets you add tokens to liquidity pools (see below) to earn rewards or lend tokens to other users, who'll repay with interest

Key Features of PancakeSwap

Spot Trading

PancakeSwap Review

Spot trading means buying or selling cryptocurrencies at a specified market rate ("on the spot"). You can swap BEP-20 tokens such as ETH, BNB, and CAKE with ease. Note that you must first connect an existing wallet holding the tokens you want to swap — PancakeSwap doesn’t support fiat currency.

Yield Farming

Yield farming is a way to earn interest on your crypto assets by depositing them into liquidity pools. Assets in such pools are staked to earn rewards, which are distributed proportionally to each contributor. Likewise, pools can lend their assets and share the interest proportionally.

PancakeSwap gives you access to different pools known as “farms” with interest rates upwards of 10%. For instance, the exchange offers a dedicated “Syrup” pool for staking CAKE tokens. You can lock up your tokens for a fixed period, or you can choose a more flexible option where you can redeem your assets at any time. But be aware that flexible staking offers fewer rewards than fixed staking.

PancakeSwap

Initial Farm Offerings (IFOs)

Initial Farm Offerings (IFOs) give users early access to new tokens being added to PancakeSwap. To participate, you'll need to swap CAKE tokens for iCAKE, which is the exclusive currency for buying new tokens from farm offerings. This feature lets users get in on the ground floor of new tokens and reap potential profits.

PancakeSwap Review

Lottery

PancakeSwap runs frequent lottery programs that give users a chance to get large amounts of CAKE tokens. You can buy tickets for the lottery using CAKE tokens, and each ticket costs roughly $5 worth of CAKE. After paying, you can pick a ticket number manually or choose a random one. If you're the lucky winner, you can win CAKE tokens worth hundreds of thousands of dollars.

PancakeSwap

Predictions

PancakeSwap runs a prediction market that lets users bet on the price movements of token pairs. For instance, for BNB and CAKE, you can bet on which price will be lower or higher at a specified future time by adding tokens to the prize pool. If you’re on the winning side of a bet, you can earn rewards of multiple times what you added to the prize pool.

PancakeSwap Review

PancakeSwap NFTs

Non-fungible tokens are cryptographic records on a blockchain that no one can replicate, and they’re often used to represent digital art. PancakeSwap offers a marketplace where you can buy and sell NFTs hosted on the Binance Smart Chain.

NFTs may appreciate in value like normal crypto tokens depending on demand, so you can buy one and sell it for a higher price in the future.

PancakeSwap Review

Cryptos Listed on PancakeSwap

  • BCH
  • BTCB
  • BNB
  • BCH
  • ADA
  • ATOM
  • DOGE
  • ETH
  • DOT
  • + more

Supported Wallets on PancakeSwap

  • MetaMask
  • Binance Smart Wallet
  • Trust Wallet
  • MathWallet
  • and many others

PancakeSwap Fees

Exchanges must earn revenue to sustain their operations, so they charge fees to users, and PancakeSwap is no exception. You can expect to pay fees on any exchange for spot trading and futures trading.

Action

Spot trading

Withdrawal

Perpetual futures trading

PancakeSwap Fee

0.25%

None

0.02% for makers and 0.07% for takers. The taker is the buyer and the maker is the seller.

Trading Fees

Whenever you make a token swap (spot trade) on PancakeSwap, you’ll pay a 0.25% fee, broken down into:

0.17%

0.0225%

0.0575%

Paid to liquidity pools as a reward for providing liquidity

Goes to the PancakeSwap treasury

Sent towards CAKE buyback and burn

Withdrawal Fees

PancakeSwap doesn’t charge fees for withdrawals like most decentralized exchanges. But note that you can only withdraw tokens to your crypto wallet — you can’t convert to fiat to send to a bank account.

Perpetual Futures Market Fees

Perpetual futures are futures contracts without an expiry date. PancakeSwap charges 0.07% of the value of the trade to the taker who initiates the trade and 0.02% to the maker who fulfills the trade.

Maker0.02%
Taker0.07%

PancakeSwap Security and Safety Features

Security is paramount for every exchange for every platform that facilitates trading. PancakeSwap’s security features include:

Security is paramount for every exchange for every platform that facilitates trading. PancakeSwap’s security features include:

  • SSL encryption: A protocol that encrypts any data transferred between your web browser and PancakeSwap’s servers. This prevents hackers from intercepting your data.
  • Bug bounty: PancakeSwap offers sizable rewards to users that find and report any security flaws on its platform.
  • Audits: PancakeSwap has passed security audits from companies like Slowmist and Certik.

However, note that PancakeSwap suffered a hack in March 2021, engineered through the platform’s DNS service provider.

PancakeSwap Availability

PancakeSwap isn’t available in some countries due to regulations, mostly as a result of sanctions by the United States. These countries include Iran, Cuba, Iraq, North Korea, Sudan, Syria, and Belarus.

How Does PancakeSwap Compare to Other Exchanges?

Three prominent PancakeSwap rivals are Uniswap, Coinbase, and Binance, so let’s see how it stacks up against them.

PancakeSwap vs. Coinbase

Coinbase is a centralized exchange with significantly higher fees than PancakeSwap. It supports fiat deposits and withdrawals, while PancakeSwap doesn’t.

PancakeSwapCoinbase
Minimum trade$1$2
Spot trading fee0.25%0.10% to 0.60%
Mobile appNoYes
Fiat currencies?NoYes
Supported blockchainsBinance Smart Chain-onlyBitcoin, Ethereum, Polygon, Binance Smart Chain, Ripple, and many others
Crypto wallet supportYes (MetaMask, Trust Wallet, Binance Smart Wallet, etc)Yes, including the native Coinbase Wallet

Read our full Coinbase review.

PancakeSwap vs. Uniswap

Uniswap is a decentralized exchange that only supports tokens hosted on the Ethereum blockchain. It has slightly higher fees than PancakeSwap.

PancakeSwapUniswap
Minimum trade$1No minimum
Spot trading fee0.25%0.30%
Mobile appNoNo
Fiat currencies?NoNo
Supported blockchainsBinance Smart Chain-onlyEthereum-only
Crypto wallet supportYes (MetaMask, Trust Wallet, Binance Smart Wallet, others)Yes (any Ethereum wallet)

Read our full Uniswap review.

PancakeSwap vs. Binance

Binance is a centralized exchange and the biggest globally by transaction volume. It has significantly lower fees than PancakeSwap.

PancakeSwapBinance
Minimum trade$1$10
Spot trading fee0.25%0.1%
Mobile appNoYes
Fiat currencies?NoYes
Supported blockchainsBinance Smart Chain-onlyBitcoin, Ethereum, Binance Smart Chain, Polygon, Cardano, and many others
Crypto wallet supportYes (MetaMask, Trust Wallet, Binance Smart Wallet, others)Yes, including the native Binance Smart Wallet

Read our full Binance review.

How to Sign Up for PancakeSwap

Step 1: Head to https://pancakeswap.finance/ and click the Connect Wallet button on the top-right corner.

How to sign up for PancakeSwap

Step 2: Select the type of wallet you want to connect, e.g., MetaMask, Binance Wallet.

How to sign up for PancakeSwap

Step 3: You’ll be redirected to the URL of your wallet platform to approve the connection.

How to sign up for PancakeSwap

Step 4: Approve the connection, and you’ll be redirected to the PancakeSwap URL and signed in using your wallet. Now you can start trading on PancakeSwap.

How to sign up for PancakeSwap

What is the CAKE Token?

CAKE is the native token of the PancakeSwap exchange built on the Binance Smart Chain (BEP-20). Owners can swap their CAKE tokens for other ones or stake their tokens to earn rewards.

This token is designed to increase liquidity on the PancakeSwap exchange by encouraging users to stake or lend their holdings or participate in the lottery program. There are over 146 million CAKE tokens in existence out of a maximum supply of 750 million. It has a market capitalization of over $3 billion.

Final Thoughts on PancakeSwap

PancakeSwap is one of the biggest decentralized exchanges globally, with nearly $4 billion in user funds. You can use it to easily trade tokens hosted on the Binance Smart Chain. It takes just a few steps to sign up on the platform if you have an existing crypto wallet. Afterward, you can swap tokens, or stake and lend them to earn interest. You can also participate in lottery and prediction markets to earn PancakeSwap’s native CAKE tokens.

This exchange has an intuitive interface and offers one of the broadest set of features you’ll find in a decentralized exchange. However, it only supports tokens hosted on the Binance Smart Chain, or BEP-20 network. You can’t trade some popular tokens like Bitcoin and Litecoin.

Frequently Asked Questions

  • Can PancakeSwap be trusted?

  • How much does PancakeSwap cost?

  • Is there staking on PancakeSwap?

  • What is the PancakeSwap minimum amount?

  • What are the PancakeSwap withdrawal fees?

  • What is the slippage tolerance on PancakeSwap?

Contributors

  • Avatar of Chisom Maduonuorah

    Chisom Maduonuorah is a writer passionate about tech startups, venture capital, the global stock markets, and emerging financial markets like cryptocurrency. When not writing, you can find him staring into the sky pondering what life is about.

  • Avatar of Shannon Ullman

    Shannon Ullman is a senior editor for DeFiRate.com. Shannon specializes in cryptocurrency and personal finance. Her work has appeared in publications like The Motley Fool and Insider.