How To Stake $CAKE On PancakeSwap? A Step-by-Step Guide

This article will walk you through the steps of staking $CAKE on PancakeSwap, BSC's sweetest yield farming platform. By TokenMetrics.io. Updated April 5, 2023.

PancakeSwap is the leading decentralized exchange (DEX) on the Binance Smart Chain (BSC). With an impressive Total Value Locked (TVL) and many exclusive features, it is no wonder they are a favorite among crypto enthusiasts.

This article will walk you through the steps of staking $CAKE on PancakeSwap, BSC’s sweetest yield farming platform.

About PancakeSwap DEX

PancakeSwap is the largest DEX on the Binance Smart Chain, known for its wide range of decentralized finance (DeFi) products and services. It is powered by baking technology and uses the liquidity protocol to facilitate trades between crypto traders. Traders must pay a fee of around 0.25% of each transaction value. The majority of the fee (around 0.17%) goes to liquidity providers, 0.03% to the PancakeSwap treasury, and the rest to buy back and burn $CAKE.

In addition to the automated market maker, Pancakeswap offers other products and services, such as the lottery, prediction pools, and even Initial farming offerings, which give investors early access to new tokens on the DEX.

About $CAKE

$CAKE is PancakeSwap’s native cryptocurrency and a BEP-20 token, meaning it runs on the BSC network.

$CAKE has a lot of use cases on PancakeSwap:

It is used for voting on proposals to decide the future of the PancakeSwap DAO.

It can be fully diluted to 750 million tokens, and any remaining tokens will be burned.

About $CAKE

$CAKE is PancakeSwap’s native cryptocurrency and a BEP-20 token, meaning it runs on the BSC network.

CAKE has a lot of use cases on PancakeSwap:

How To Earn $CAKE On PancakeSwap?

Here are ways to earn $CAKE on the platform:

Providing liquidity to new cryptocurrency pairs in standard or high-risk pools.

Participating in the lottery for a chance to win a portion of the lottery jackpot.

Winning prediction pools by successfully predicting the outcome of an event.

Joining new coins’ initial farming offerings to gain early access to tokens.

How To Stake $CAKE On PancakeSwap?

Funding Your Wallet

Set up your wallet and make sure it’s sufficiently funded with $CAKE and $BNB tokens. You need $BNB because $CAKE operates on the BSC network and relies on $BNB to cover transaction fees.

Connecting Your Wallet

Once your wallet is adequately funded, head over to PancakeSwap.finance and connect your wallet. Look for the “Connect Wallet” button in the top-right corner of your screen.

Selecting A Liquidity Pool

After connecting your wallet, hover over “Earn” in the top menu and click “Pools.”

Here’s a brief overview of the other options available:

For this guide, we will only be focusing on liquidity pools.

Choosing The Right Staking Pool

Selecting the right staking pool requires careful consideration of several factors:

The cryptocurrency pair: Different cryptocurrency pairs offer varying degrees of risk and potential reward.

The staking type: Flexible staking allows you to withdraw your tokens at any time, while locked staking offers higher rewards but requires you to lock your tokens for a specific period.

The lock-in period: For locked staking, the lock-in period can range from one to three months. A longer lock-in period usually yields higher rewards.

The annual percentage yield (APY): This factor indicates the rate at which your staked tokens will generate interest over the course of a year.

The total value locked (TVL): This metric reflects the total value of cryptocurrency deposited into the staking pool. A higher TVL might suggest a more popular and actively used pool.

Remember that higher expected rewards come with more significant risks. So if you are required to lock your tokens, your risk level rises significantly.

Only the base $CAKE pool is indefinite on PancakeSwap; other pools typically last for three months. Consider whether this duration works for you to at least break even, taking into account the gas fees incurred when sending, allocating, and exchanging tokens.

Initiating The Staking Transaction

Once you have chosen the staking pool, click “Enable Pool” within the pool details. This will permit PancakeSwap to manage your tokens through a smart contract.

If you are using MetaMask, you can set a spending cap as a security measure in case of an exploit.

Next, choose between flexible or locked staking and specify the lock-in period. Then, enter the amount of $CAKE you want to stake and confirm the transaction in your wallet.

Final Thoughts

PancakeSwap’s ecosystem, utility, and governance have made it a preferred choice for DeFi users. You can sweeten your crypto portfolio and enjoy the delectable rewards it offers. So take the plunge and start staking $CAKE on PancakeSwap to experience the best of Binance Smart Chain’s top DEX!