PancakeSwap Is interesting because offers almost 100% annual yield Market Cap per Total Value Locked
is only 1/2 that of Uniswap Transactions from PancakeSwap on BSC
is more than the entire Ethereum network. You should put the sugar first. Look, I’m in the middle of something here. I’m trying to record a video. Thank you, thank you. Fees are a 1/100 of Uniswap on Ethereum,
making it a much cheaper option Is there a discount? Well it’s two factors. Gas price is only 5 Gwei on BSC
vs 100+ Gwei on Ethereum and then price of one BNB is roughly 1/5 of Ethereum. The first round was definitely won by PancakeSwap. Uniswap v3 with Optimism, Ethereum L2 will
definitely make an interesting re-match. But as of today those almost 100% are still there. 100%? Yeah. Per year? That’s double. Yeah. Ok, you can put in my money. You need tokens. It’s a digital currency. You still need tokens.
Yes I have those Binance Money. You do? Yes they were very expensive. I paid 10 dollars. You bought BNB at 10 dollars?
as good as my technical analysis! No, for 100. Yes, I paid 10 dollars for 100 of those Bnb
coins in that Ico. You bought BNB at 10 cents? Yes very expensive. But they’re worth 500 dollars now. You’re up 5,000 times! You and your pretend money.
Can I make 100% or not? Why don’t I show you with 3 of your BNB. Ok. So now we have received an account with 3
BNB in it. Before we start, this is not financial advice. For example this would probably have realized
capital gains tax for auntie here, far exceeding the farming revenues. In your real case, take help from a licensed
financial advisor in your jurisdiction who can take your specific situation into account.
I’m not that. Now let’s see if we can make that 100% annual
percentage yield for auntie or not on this borrowed tutorial account. I will go really quick. You can play it back
in 50% speed later if you want more time to follow the steps. First we add MetaMask to our Chrome as an extension.
Make sure you get the right one. Then we create a wallet. We create a
password. This is not your recovery seed. This is the recovery seed. Make sure to write it down
on a piece of paper and don’t lose it. Then we go to PancakeSwap, we connect MetaMask and MetaMask will automatically add the configuration.
You don’t have to do that manually any more. As you can see we are connected to Binance
Smart Chain. Now we will withdraw 3 BNB from auntie’s
account to our MetaMask. Copy the address to our MetaMask. Select Binance Smart Chain. We are already on BNB. And 3 BNB, we can add the fee also so we get
3 BNB exactly to our MetaMask. And it’s arrived.
Let’s start with the comparably safer, with
highest liquidity, and that is CAKE-to-BNB farm. Then let’s check the highest APR, highest
Annual Percentage *Rate. I’ve no idea what it is. I just quickly
checked on Coingecko and Twitter, which by the way had different icons. Not exactly trust
building. Anyway, 500% – let’s take it! If we try to add liquidity now, it’s not
going to work because the way liquidity pools work is that you have two coins of equal size,
and we have only one, right. So let’s use 1 of our BNB’s for the BNB-CAKE
liquidity pool. So we change 1/2 BNB into CAKE. Ok, done. And now we can add liquidity. We make sure there is enough coins of both types.
Ok. And now you can see we have a liquidity pool
here at the bottom. We have 1.958 of the pool tokens we give access
to those CAKE and BNB. Now we can go back to the farm and stake those
liquidity pool (LP) tokens. And you can see that those 1.959 pool tokens are
now staked and will start earning cake. Now let’s go to the 500% pool, DFD-BUSD. Ok, so then we need those tokens. Let’s take 100 DFD dollars and 100 BUSD dollars. If we go to bscscan we can see they have arrived
in the wallet. Now we can add to that liquidity pool and we see that we got the pool tokens here. Let’s stake them in the farm, start farming
CAKE. All right, they are staked and will start
earning CAKE. Now let’s go to the syrup pool.
So what they syrup pool means is that you
stake only one coin. You stake only the CAKE for example. So let’s use 1 BNB for that purpose and
swap it to CAKE. All right we got those CAKE and let’s put
them in the pool. Let’s pour them in the syrup pool. And we see we have now a stake in the CAKE
pool with an APR of 91 %. No syrup! I don’t like syrup. Swedish pancakes must have strawberries. Of course. You boy, stop there. Now you explain it to me like I’m 85, which I am obviously not.
But how can they give 100% return? You can’t get 100% return with no
risk of loss. Risks first: – CAKE PRICE DOWN You’re still investing here, weighing risk
vs reward. In the pools you get 100% more cake annualized,
but we don’t know if the price of cake will go up or down. – PANCAKE BURNS There’s also the risk that PancakeSwap as
a whole disappears, rug pulls with all your money. Now this is a flagship project of Binance,
so I guess they would go to some extent to try to prevent that from happening, but still
this is a separate entity. – FARM RUG PULL On the Farms, if one of those coins go to
0, you will lose all the money. And on the higher risk tokens, 100% isn’t
enough to take those trades. The market needs more. There is a substantial risk that one of those
small projects disappear or dump in value. 500% annually is maybe 1% per day. But maybe
I lose 100% tomorrow.
– IMPERMANENT LOSS There is also the concept of impermanent loss. You see the chart here. Once you deposit your 2 assets into the liquidity
pool, you no longer own the assets, you own a share of the pool. Then if prices changes, people will rebalance
the pool. Then when you sell your share of the pool,
you have a different number of tokens than what you deposited. That’s the impermanent loss, which is very
much permanent. The rewards then. – MORE CAKE The reward if taking on all those
risks, is almost 100% in CAKE or more on some farms. That’s the trade. – CAKE PRICE UP So far, the CAKE pool has given way more than
100% because CAKE hasn’t gone down. It has gone up. By a lot. The return here has been in the 1,000s of
percent, not 100%. My pension fund gives 1%. I like those 1000%.
Mm. We will come back to Technical Analysis at
the end of the video. You’re still investing. This is a risk/reward
Now let’s check Auntie’s account. Let’s check the farm first. Oh look we have earned .03 CAKE or 1.2 dollars and here on the higher risk farm we have earned
.06 CAKE or 2.7 dollars. So this is in one day, meaning 24 hours later. And if we calculate that timed 365 we see
that is actually 90%. Now let’s harvest those and there is a new
feature here. You can press Compound and then those CAKE
gets reinvested so you get like interest on interest. Let’s harvest our farm tokens now. We harvest those CAKE. We harvest those CAKE. Max. Take it out. Let’s first unstake the syrup pool. Ah we got the CAKE back. And on the farms, under liquidity, we can
see our two pools here.
So press remove, max. Let’s remove the liquidity, get our coins
back. Now we have removed all the liquidity so we
have our coins back, our BNB, our CAKE, our BUSD, and the DFD coins and zero LP tokens because we have removed
the liquidity. Now let’s change it back then to BNB, which
we started with. Let’s take the CAKE first, we swap it
back to BNB. We got some more BNB’s here now. Let’s take the BUSD. Max. Swap it back to BNB. Approve. And let’s take the dangerous DFD, which
I don’t even know what it is. Will it still be worth something? Will we
get our BNB back or not? Failed! Swap failed error. That is not what we wanted.
Let’s try again. Waiting, confirm. Ah it worked. It worked. Phew. We got it back. We got out guys. And look! We have now 3.1 BNB for auntie. And everything else is empty. All right! While I recorded this there was actually a
lot of connection problem. I tried with a lot of different RPC providers. It was actually
a mess. Now let’s send it back to Auntie’s account.
Not bad! And it has arrived. So it worked. We made money for Auntie here. But as you see, the majority of the money made
was because CAKE went up from yesterday to today, not because of the Pool or Farm rewards. This is the plot twist because this is typical for this type of market. The price development usually overshadows
the APY yield, even if it’s 100% or more. So maybe we are missing the point? Let’s look at the outlook of PancakeSwap
as a whole.
FEES The key advantage now is the Fees. Cheap on PancakeSwap as you saw. Crazy expensive at Uniswap locking out most retail
investors and auntie doesn't like it. That will change when Uniswap builds on L2
with Optimism. INNOVATION Uniswap v3 is adding a big innovation with
concentrated liquidity. That will reduce slippage by a lot, which makes you get a better price
if you trade large positions. DEVELOPMENT The first time PancakeSwap just forked the
code. This time they can’t do that because Uniswap got wiser and changed to a business
license. No more Open Source free to use for all from Uniswap. Then PancakeSwap needs to copy the idea instead
of the code. Can they do that and how long will it take?
I don’t know. That’s something we need to monitor.
TOKENOMICS PancakeSwap has a complex token issuance schedule.
They mint new tokens, but they also burn them. The team says it will be deflationary. Hard
to overlook. What we can say with certainty is that Uniswap
is going to add a lot more tokens. Team. Investors. Advisors. Community. Hmm. TEAM PancakeSwap has an anonymous team. Uniswap is backed by a lot of US VC, while
running an exchange that’s, to my knowledge not so regulated by US authorities.
I’m not a lawyer and I’m not from the
US. I’m an engineer, but even I can see risks with both approaches. BRAND PancakeSwap is whimsical with lotteries and
games. Uniswap has made themselves a more serious profile for serious larger investors. I’m not much of a lottery person myself,
but I can understand the appeal of both approaches. While I’m sharing this, please also share
your thoughts in the comments. And subscribe of course. DECENTRALIZED Then let’s come to the most contested issue.
"But Binance Smart Chain is a centralized database and Ethereum is decentralized God’s work
by the community." I see it like this: Yes, Ethereum is a lot more decentralized
than BSC at this point. No doubt. But permissionless and decentralized are not
the same thing. Those are two different use cases. You have the answer in front of you. It’s
clear that there is demand for permissionless access to an exchange, even if it’s less
Also I think it’s wrong to assume that even
if something isn’t perfect day one BSC can’t improve it. And Uniswap runs on a website by a VC-backed
company. It can be shut down too. CAPACITY Ethereum is full. That’s why costs are so
high on Uniswap. But is the Binance Smart Chain network also
getting full? I struggled a little bit to find this answer
but eventually I found the answer from ktzw on Reddit.
The current gas limit per block is 40 million. You
see that here. But that a soft limit, which increases if the previous block is almost full. But then the gas limits will revert back.
There are draft proposals apparently to increase the gas ceiling to 60M. That’s 24 times throughout vs Ethereum.
It’s not 100 times or 1000 times. In the end, Layer 2 is needed. If Ethereum’s
L2 works, BSC is going to need it too to keep up. Are they working on that? I don’t know.
We better keep track. FLIP Can PancakeSwap flip Uniswap? Anything is
possible guys. Everything in global technology seems impossible until it happens. Don’t
be so sure of your own opinion. Be open to anything. Uniswap will for sure have a revival with
Optimism and the concentrated liquidity. But why do you have to choose? This is not religion, guys or your partner.
You can like more than one use case. It is ok. DEXs will no doubt be part of the future.
At least be part of that industry movement somehow. But here is an important conclusion.
If you have decided to hold the CAKE coin
while it’s in an uptrend, using this POOL service is a no brainer, in my opinion. If the project rug pulls and shuts down the
whole project, the token will drop 99% anyway. So having it on an exchange just means that
you’re missing the yield. We have one more thing. What about the Technical
Analysis? Where are we right now? Let’s start with the CAKE/BUSD chart and let’s go back to January because Larsson Line flipped gold around here and then there was actually a dip right after
that which gave you an entry in an uptrend if you were looking to get in.
Then we can see this resistance line broke
through and flipped support, retested support multiple times and then – blast off! Then found new support, broke through this
resistance and retested that resistance-flipped-support one more time. A text book chart. Even more interesting I think is looking at
CAKE vs. BNB because that is really the ecosystem it is playing in And you can see the trend is up even there
and look here what well defined support & resistance lines we have. Here is support, touch resistance, down to
support again. Should it break through, close above that,
that is a strong signal. And actually after I recorded that segment,
it broke through and on the USD chart it already hit 40 dollars. It’s too little sugar. Next time you put more, and first.
Hm. Subscribe. Watch the next video. CTO Larsson out. Hej då! Hm..