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- The suggestion to reduce token supply by 300 million will be up for vote for one day.
- The plan is scheduled to go into effect on January 4, 2024, if it is approved.
Declining the maximum quantity of its ecosystem token, CAKE, from 750 million to 450 million is the goal of developers of decentralized exchange (DEX) PancakeSwap.
The suggestion to reduce token supply by 300 million will be up for vote for one day, as stated in a release made on December 28. Also, the plan is scheduled to go into effect on January 4, 2024, if it is approved.
Eyeing Further Deflation
Moreover, the developers of the project pointed out that the revised plan would bring CAKE in line with its present supply of 388 million.
The developers stated:
“Now that CAKE has achieved consistent deflation for several months and is focusing on accelerating the journey to ultrasound CAKE, the proposal aims to reduce the CAKE token’s total supply.”
From its start in September 2020, when CAKE was at its most inflationary, with a net emission rate of 40 per block, the inflation rate has been steadily declining. As part of the benefits for staking, users get CAKE.
The developers further added:
“Lowering the total supply is a critical step to achieve ultrasound CAKE and to send a clear signal of PancakeSwap’s pivot away from a hyperinflationary tokenomics model.”
The proposal to reduce the CAKE Syrup Pool emissions from 6.65 CAKE per block to 3.0 CAKE per block, with a 0.5 CAKE reduction per block per month for five months, was adopted by token-holders on April 25. Since a token burn mechanism was implemented, CAKE tokens have essentially become deflationary.
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