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PancakeSwap has burned over $62 million in CAKE this month, yet the token’s price remains on a negative trend.
In a recent tweet, the popular decentralized exchange (DEX) PancakeSwap disclosed a significant milestone in its ecosystem.
Specifically, the BNB Chain DEX revealed that a whopping 9,000,841 CAKE tokens, equivalent to roughly $19 million, have been wiped out of circulation in its latest burn schedule.
🔥 9,000,841 $CAKE just burned – that’s $19M!
💰 Trading fees (AMM V2): 187k CAKE ($397k) +40%
💰 Trading fees (AMM V3): 102k CAKE ($217k) +56%
💰 Trading fees (Non-AMM like Perpetual, Position manager etc): 17.5k CAKE ($37k) +1115%
🔮 Prediction: 46k CAKE ($98k) +24%
🎟️ Lottery… pic.twitter.com/wcTg4TxJJS— PancakeSwap🥞Everyone's Favorite DEX (@PancakeSwap) December 18, 2023
Note that CAKE is the native token of the DEX platform. PancakeSwap noted that the over nine million CAKE were sent to a non-recoverable address, effectively burning the tokens. This burn event significantly reduces the overall supply of CAKE, potentially contributing to its price appreciation in the long run.
Contributors of the 9M+ CAKE Moved to Dead Address
Furthermore, the tweet detailed the breakdown of the burned CAKE, highlighting the sources that contributed to the endeavor.
Trading fees accrued from the automated market maker (AMM) version 2 had the largest contributing share. Specifically, AMM V2 burned CAKE tokens worth $397,000, representing a 40% increase from the amount recorded last week.
Trading fees from PancakeSwap’s AMM V3 followed closely, contributing $217k to burning 102,000 CAKE tokens. This figure represents a more substantial 56% from the previous week’s burn schedule.
Meanwhile, non-AMM fees like those from perpetual and position manager contracts saw a staggering 1,115% surge in their one-week contribution to burning CAKE.
Other sources of burned CAKE included the prediction market, lottery and pottery activities, and the NFT marketplace. While prediction fees saw a healthy 24% increase, lottery and pottery contributions dipped slightly by 7%. NFT fees declined by 13%, suggesting a softening demand in the PancakeSwap NFT marketplace.
$62 Million Burned This Month
In the previous week’s CAKE burn announcement, PancakeSwap disclosed incinerating 9,170,886 tokens. At the time, the market value of the eliminated coins was approximately $22 million.
Similarly, on December 4, the DEX platform announced burning 8,808,741 CAKE, equivalent to $21,000,000. Notably, this higher dollar value compared to the figures recorded from more recent burn schedules was based on CAKE’s loftier market price.
Cumulatively, PancakeSwap has eliminated 26,980,468 CAKE tokens worth over $62 million so far this month.
Meanwhile, the ongoing burning of CAKE seems to have had minimal positive effects on the price of digital assets. According to CoinMarketCap, CAKE has experienced a 13% decline in the last 30 days. Currently priced at $2.23, this marks a staggering 94.96% decrease from its 2021 all-time high of $44.18.