NEW REWARD TOKEN + NEW LP FEE STRUCTURE

I have been in Cake since the first week it was launched. I invested when few people knew about it and considered it a joke. Now Pancake swap is the #1 decentralized exchange based on users and volume. The Pancake swap team deserves a huge amount of praise for their efforts for how they have evolved the platform. But its time to evolve again.

Pancake swap has done an incredible job of creating a deflationary token system. It has redefined ICOs and made them safe for everyone. Just a few years ago ICOs were riddled with scams as you had to send your crypto blindly to an address hoping you would get something back. Now all you have to do is hold the Cake token. Major projects like Coin 98, Trust Wallet, Axie Infinity and hundreds more were given to Cake holders just for holding the token. Now EVERY other Dex is trying to copy this model. But the projects they give pale in comparison to what Pancake provides.

In an effort to reduce Cake inflation they have had to remove rewards for certain LPs. This caused people to remove their liquidity. It's important to note that Pancake did not remove these pools as some would suggest, they just removed the CAKE rewards for them. But there is a reward structure you receive for providing LP, and many LPs pay great rewards in the provided tokens. Few understand this. Instead they say "Pancake removed our pool" There are some pools that pay over 100% in fees with no Cake rewards (search for them).

That said, the FUD of "Cake removed our pool" has resulted in less liquidity, and as a result higher fees when swapping many tokens. It's not about the fee that Pancake charges, that's still one of the lowest in the industry, rather its the PRICE IMPACT. If there isn't enough liquidity you can pay over 5% in some cases. But becuase the pool isn't incentivized enough people aren't providing liquidity to reduce the price impact. You can't have an efficient exchange without people providing liquidity. This is a problem for ALL decentralized exchanges. Not just Pancake Swap.

SOLUTION

1. Stop Cake emissions.

The Cake reward structure was devised at a time when no one knew how big DEFI would become. Cake has grown bigger than anyone could have imagined. The old Cake reward structure no longer works for the future. There is however a fantastic deflationary mechanism in place. Cake would continued to be burned by these mechanisms. Cake would also still be used in IFOs and governance and voting. You also MUST own a minimum amount of Cake just for using the platform. There are too many people using the platform that dont own Cake.

2. Create a New Reward Token.

This token will be used to incentivize LPs longterm. Rewards would never be removed from the LPs. The only way you would receive this token is by having Cake. The reward token could be incentivized in other ways. The team knows how to create deflationary models to keep the price stable.

3. Replace many of the BNB LPs with Cake.

BNB has many deflationary mechanisms in place and no one can use BSC without BNB. But again we're giving away too much Cake to non Cake holders.

4. Increase the fees to providers.

0.17% to providers is not enough. This needs to be at least 0.3 or higher. This means the total fee needs to be at least 0.43% to continue to burn Cake at the same rate. Although with NO inflation, we dont need to burn Cake at the same rate. If this seems high to you...you're wrong. With stock brokerages it is typical to pay over 1% in fees for transactions. Forex the lowest fee you pay on the most liquid pairs is 1.2% Even Coinbase charges almost 2% on exchanges. They do this by manipulating their exchange price vs the real price.

In reality in most cases you are paying more than 0.43% because of the price impact. If your price impact is 0.3% that means your TOTAL fee is 0.6% 0.3% is a VERY LOW price impact but thats still higher than it should be. If we all provide enough liquidity then we can get the price impact on ALL pairs to less than 0.1%

The exchange then becomes more efficient. Which is what we all want.