PancakeSwap, the biggest decentralized exchange (DEX) on the BNB Chain, has announced that it’s rolling out a new system for how its CAKE token works—called Tokenomics 3.0. The new system will officially go live on April 23, 2025, and it’s meant to make the token more valuable and the project more sustainable over time.
What’s Changing in CAKE Tokenomics 3.0?
The team behind PancakeSwap says they have three main goals with the update:
- Make CAKE deflationary – This means they want the total supply of CAKE to slowly shrink over time, which could make each token more valuable.
- Simplify the system – They’re getting rid of complex tools like veCAKE, which gave users voting rights and rewards if they locked their CAKE.
- Cut down token emissions – They’re reducing how many new CAKE tokens are created each day.
Here’s what’s actually happening:
- No More CAKE Staking or veCAKE: PancakeSwap will remove staking, voting, and revenue-sharing features. Anyone who had their CAKE locked in these systems will have their tokens unlocked, and they’ll have six months (until October 2025) to withdraw them.
- New Burn System: Instead of rewarding users with fees, PancakeSwap will burn CAKE tokens—which means permanently removing them from circulation. The team expects to burn around 5.3 million CAKE each year to help reduce supply.
- Fewer Tokens Printed Each Day: Right now, PancakeSwap creates about 29,000 new CAKE daily. That number will first drop to 20,000, and then to 14,500, making the token more scarce.
This kind of deflation model has worked for other crypto projects in the past—Binance Coin (BNB) has regularly burned tokens to support its price, and Ethereum’s EIP-1559 upgrade introduced a similar burning model in 2021.
Community Reaction: Divided Opinions
Some in the community support the move. One team member, Chef Philip, said the update will make the project stronger in the long run by focusing on “real value” instead of short-term rewards.
But not everyone agrees.
Cakepie DAO, a major group that built tools around veCAKE, isn’t happy. They say PancakeSwap’s decision came with little notice and could hurt projects that have trusted and built around the old system.
“We locked millions of CAKE for four years based on PancakeSwap’s previous promises. Now, all that effort and trust might go to waste,” Cakepie said in a statement.
To ease tensions, PancakeSwap offered $1.5 million worth of CAKE tokens to Cakepie’s community, asking them to swap their mCAKE (a special version of CAKE) back into regular CAKE. Cakepie is currently holding a vote to decide whether to accept the deal.
Market Reaction
Since PancakeSwap first announced Tokenomics 3.0 on April 8, 2025, the price of CAKE has gone up 17%, now trading at around $1.97.
Also, trading volume on PancakeSwap recently hit $1 billion in 24 hours, putting it ahead of even Uniswap, which is usually the top DEX on other chains.
According to DeFiLlama, PancakeSwap now handles over 90% of the trading on BNB Chain, showing just how important it is to that ecosystem.
