Home Crypto Exchanges PancakeSwap AMM Liquidity Pools lending to DEX Apps Here to Stay

PancakeSwap AMM Liquidity Pools lending to DEX Apps Here to Stay

PancakeSwap DEX Apps

There are, right now, over 170k unique LPs on PancakeSwap V2. That means that the community has created an average of *152 LPs per hour* since V2 launched on April 23rd. For context, V1 had around 86k pairs after 8 months. V2 basically doubled it in just over a month. Wild.

Once you are ready with the funds to contribute to the liquidity pool you can add your liquidity to the pool after paying the due BNB.  When you are supplying the pool with liquidity you need be clear about the percentage share you are contributing to the liquidity pool. After contributing to liquidity you will receive the “Pool Tokens.”

The Pool tokens track your contribution to the pool and you will earn the fees proportional to the share of the pool.  This amount can be redeemed anytime. Users will be able to earn fees proportional to the share of the pool. The ratio of your tokens will change over time as more liquidity pool providers enter and leave the pool. 

There are also possibilities to win some NFTs on the Binance smart Chain. Those who are chosen winners will be able to trade it for the CAKE value that it represents or you can keep it in your wallet as is.

Programmers who are interested can join PanCakeSwap and build the future of Defi. They are hiring for full-time remote positions which are well paid in crypto.

For clarity, decentralized finance permits making money by earning fees on the financial services.  People earn money by providing liquidity.

Investors stake their crypto to apps.  DEX are the apps which need the most liquidity as they have the heaviest flow of transactions.  So, the money invested in the liquidity pools are lent to DEX.

DEX need to have enough liquidity if they need to function well. Therefore, investors who participate in liquidity pools will benefit as there is forever a need for liquidity at DEX and since DEX is the major app that buys from the liquidity pools it is good to be a part of this market.

Since users don’t trade versus another person, they trade with the smart contract, a type of software program, an AMM is always willing to buy and always willing to sell at a stated price.

From the technical perspective, the functioning of the liquidity pool is the same.  There is just a difference in community and a difference in what they choose to incentivize related yield farming.

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Maheen Hernandez

A finance graduate, Maheen Hernandez has been drawn to cryptocurrencies ever since Bitcoin first emerged in 2009. Nearly a decade later, Maheen is actively working to spread awareness about cryptocurrencies as well as their impact on the traditional currencies. Appreciate the work? Send a tip to: 0x75395Ea9a42d2742E8d0C798068DeF3590C5Faa5

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