PancakeSwap Unveils CAKE Tokenomics 3.0 Rollout Amid Community Debate Over veCAKE Phaseout

PancakeSwap to Launch CAKE Tokenomics 3.0 on April 23, Sparking Dialogue on Long-Term Sustainability

PancakeSwap, the leading decentralized exchange (DEX) on the BNB Chain, has confirmed that its highly anticipated CAKE Tokenomics 3.0 upgrade will begin rolling out on April 23, 2025. The overhaul is designed to establish a more deflationary and sustainable token model for CAKE, the platform’s native asset.

The update arrives during a period of renewed optimism, with CAKE prices rising 17% since the proposal’s unveiling on April 8. Yet, despite the market’s positive initial response, the changes have stirred a lively debate within the DeFi community—especially among long-term ecosystem builders.

What’s Changing in CAKE Tokenomics 3.0?

The new model is centered around three core objectives:

• Targeting a 4% Annual Deflation Rate
• Simplifying Token Utility by Retiring veCAKE and Related Features
• Reducing Daily CAKE Emissions to Improve Long-Term Value

Key changes include:

• Sunsetting CAKE Staking and veCAKE: PancakeSwap will phase out CAKE staking, the veCAKE locking mechanism, and related features such as gauges voting, revenue sharing, and farm boosting. All locked CAKE and veCAKE will be unlocked, with users given a six-month window starting April 23 to withdraw their tokens.
• Token Burning as a Deflation Strategy: Instead of distributing trading fees to users, PancakeSwap will now burn CAKE tokens to reduce supply—projecting an annual burn of around 5.3 million CAKE.
• Emission Reductions in Phases: The platform plans to decrease daily CAKE emissions from 29,000 to 20,000, and eventually to 14,500 tokens to help drive deflationary pressure.

Community Divided Over veCAKE Removal

While some stakeholders support the initiative for prioritizing long-term token value, others are voicing sharp criticism.

Chef Philip, a PancakeSwap core contributor, defended the move:

"CAKE Tokenomics 3.0 defends true value and protects CAKE holders by strengthening long-term fundamentals—such as aggressively cutting emissions to accelerate deflation and sustainably grow value."

However, Cakepie DAO, a major veCAKE holder and ecosystem project, expressed strong opposition. In a statement on X, they called the decision “non-transparent” and damaging to protocols built around veCAKE.

“Sunsetting veCAKE would be devastating for Cakepie and every project built on long-term alignment with PancakeSwap,” the DAO said. “Millions of CAKE were locked for up to four years to demonstrate our commitment. Removing veCAKE undermines that commitment overnight.”

To address the concerns, PancakeSwap has proposed a $1.5 million compensation package in CAKE tokens, contingent on Cakepie agreeing to a 1:1 token swap from mCAKE (Cakepie’s CAKE derivative) to CAKE. Cakepie is currently voting on whether to accept the offer.

Market Outlook and Ecosystem Impact

Despite internal disagreements, PancakeSwap remains a dominant force in the DeFi space. According to DeFiLlama, the platform’s 24-hour trading volume recently surpassed $1 billion, briefly overtaking Uniswap. It also maintains over 90% of the DEX market share on the BNB Chain, reinforcing its foundational role in the ecosystem.

At press time, CAKE is trading at approximately $1.97. Analysts are closely watching whether the new tokenomics structure can maintain this momentum and reinvigorate investor confidence in the long run.