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PancakeSwap Price Prediction | Is PancakeSwap a Good Investment?

PancakeSwap is a decentralized exchange on the Binance Smart Chain – Source: Shutterstock

CAKE, the coin of the decentralized exchange (DEX) PancakeSwap, has been rocked by a burst of turbulence this year that has seen its price plummet.

Though the downward trend has eased, the coin remains down more than 60% year-to-date (YTD).

But it is hoping to turn this downward trend around, recently announcing plans to expand to more blockchains.

Can the price regain and retain upward momentum? What is a realistic target price for the near future? Is now the time to ‘buy’, ‘hold’ or ‘sell’?

In this article, we look at recent developments in the PancakeSwap ecosystem, the latest CAKE coin price predictions and technical analysis to help you decide if CAKE should be part of your portfolio.

How does PancakeSwap work?

PancakeSwap is a decentralized exchange (DEX) on the Binance Smart Chain (BSC). Launched by anonymous developers in September 2020, it is similar to Uniswap on the Ethereum blockchain.

Whereas centralized exchanges like Coinbase and Binance are run by a single company, one can trade on a DEX without an intermediary. Like most decentralized finance (DeFi) activity to date, most DEXs are based on Ethereum. PancakeSwap, however, aims to compete with Ethereum by providing lower fees and faster transactions, among other features.

PancakeSwap operates on an automated market-maker (AMM) model. Users deposit their funds into a liquidity pool in exchange for income from liquidity provider tokens, known as FLIP tokens. Users make their trades against the liquidity pool.

Holders of FLIP tokens can then use them to reclaim their share of the liquidity pool and a share of trading fees. Users can deposit and lock up their FLIP tokens to farm, or earn, additional tokens such as CAKE and SYRUP as a reward. There is no set holding time before tokens can be unstaked.

PancakeSwap has quickly attracted users since its launch because it allows traders to instantly swap tokens without registering for accounts, and charges low transaction fees. Users can trade directly from their cryptocurrency wallet, as the cryptocurrency is not held on an exchange.

According to its website, in total its users have staked $4.2bn, and its 1.8 million active users made 55 million trades in the 30 days up to 1 November 2022.

CAKE stalls after cryptos bottom out

CAKE went live on 29 September 2020 at $1.37 and struggled to pass its launch price for its first few months.

However, CAKE experienced its biggest rally to date with the bull market in 2021. The cryptocurrency rocketed to its all-time high of $44.18 on 30 April 2021. After a drastic correction, it climbed again to $26.59 on 26 August 2021 from its 20 July low of $10.87, but fell to $17.85 on 8 September 2021.

The market moved back up to $23.72 on 19 September 2021, but unlike other cryptocurrencies such as Bitcoin (BTC) and Ether (ETH), which hit new all-time highs, the CAKE price declined in October, ending the month at $17.68, as the chart shows.

It continued this downward trend into the new year, following the wider bear market at the time. It stooped below the $10 mark in January and under $5 in May as the crypto industry crashed.

New developments

In recent PancakeSwap news, the DEX revealed an updated roadmap as it entered the fourth quarter of 2022.

It announced a new swap router would be integrated that would “improve the capital efficiency and trading experience”.

Most notably, PancakeSwap revealed it was expanding into different blockchains.

The Medium post said: “In this Q4 PancakeSwap is trying to go multichain to expand our userbase, as well as developing better products to help us offer better and more competitive services than our competitors. In every quarter, the vision is to improve and make sure PancakeSwap is growing.”

CAKE reached a high of $4.63 on 18 October, but was unable to maintain the momentum and saw a slight dip. As of 1 November, CAKE was trading at $4.56 and was down 3% in the past 24 hours.

However, it was up 2.4% over the previous week as it announced a competition for builders on the newly launched Aptos blockchain, which was combined with a Q&A between the two crypto organizations.

PancakeSwap price prediction: Can it rebound in the long term?

At the time of writing, the CAKE price prediction from CoinCodex was bearish, with 11 indicators giving bullish signals and 16 bearish. However, its short-term PancakeSwap price prediction for 2022 estimated the price could have risen to $4.75 by 1 December.

The PancakeSwap coin price prediction from algorithm-based site Wallet Investor was very bearish, with an estimation that the price could have fallen to $0.30 in 12 months’ time and drop below in $0.20 in 2027.

DigitalCoinPrice’s CAKE crypto price prediction suggested the cryptocurrency could have averaged $4.69 in 2022. Its PancakeSwap price prediction for 2025 expected it to hit $11.80, and then achieve $25.08 in 2030.

Price prediction was more bullish for CAKE’s longer-term future. It projected the price could rise from an average of $5.63 in 2022 to $15.83 by 2025. Its PancakeSwap price prediction for 2030 gave an optimistic value of $105.59.

When considering a PancakeSwap crypto price prediction, it’s important to keep in mind that cryptocurrency markets remain extremely volatile, making it difficult to accurately predict what a coin or token’s price will be in a few hours, and even harder to give long-term estimates. As such, analysts and algorithm-based forecasters can and do get their predictions wrong.

If you are considering investing in cryptocurrency tokens, we recommend that you always do your own research. Look at the latest market trends, news, technical and fundamental analysis, and expert opinion before making any investment decision. Keep in mind that past performance is no guarantee of future returns, and never trade with money that you cannot afford to lose.

FAQs

Is PancakeSwap a good investment?

When it comes to a highly volatile asset like a cryptocurrency token, it’s important that you do your own research to determine whether it’s a suitable fit for your investment portfolio. The decision depends on your risk tolerance and financial circumstances, among other personal factors. Keep in mind that you should never invest more than you can afford to lose.

Will PancakeSwap go up or down?

As of 1 November 2022, forecasts from sites such as PricePrediction estimated that the CAKE price could climb over the long term, such as to $105 by 2030. But WalletInvestor was more bearish over its future.

In volatile cryptocurrency markets, it is important to do your own research on a coin or token to determine if it is a good fit for your investment portfolio. Whether the CAKE token is a suitable investment for you depends on your risk tolerance and how much you intend to invest, among other factors.

Keep in mind that past performance is no guarantee of future returns, and never invest money that you cannot afford to lose.

Should I invest in PancakeSwap?

Whether you should invest in CAKE is a question that you will have to answer for yourself.

Before you do so, however, you will need to conduct your own research. Never invest more money than you can afford to lose, because prices can go down as well as up.

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