TL;DR
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Back on April 19, a proposal was created to change the CAKE tokenomics.
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The proposal is very likely to pass, as more than 55% of people opt for “an aggressive reduction in wagering rewards” (and therefore an aggressive reduction in inflation for the project).
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What’s cool is that when we zoom out and look at this process as a whole, it’s fundamentally different from anything we’ve seen before.
Full story
Imagine your bank says, “Instead of that 20% interest we promised you, we’re going to give you 3-5%.”
“We believe it’s better for all our customers and if you don’t agree, you can leave.”
Well, that’s pretty much exactly what’s been happening with the PancakeSwap project over the past week or so.
Back on April 19, a proposal was created to change the CAKE tokenomics.
Here’s the long and the short of it:
“Current inflation rates are unsustainable for CAKE in the long run, and reductions are necessary for PancakeSwap’s long-term health.”
Translation:
We thought we could offer a 20% return on CAKE, but it turns out that if we want this project to last indefinitely, we need to cut that back to 3-5%.”
The response from the community has been…interesting.
On the one hand, since April 19, the amount of CAKE wagered has dropped from 1.007 billion to 677.851 million (at the time of writing) and the price has dropped by almost 25%.
At the same time, the proposal is likely to go ahead with more than 55% of people opting for “an aggressive reduction in wagering pay” (and therefore an aggressive reduction in inflation for the project).
So basically CAKE holders are saying, “Hey, we don’t like this, but the reality is it’s the best thing for the project overall.”
Whether this is good or bad, right or wrong, we are not the ones to say.
What’s cool, though, is that when we zoom out and look at this process as a whole, it’s fundamentally different from anything we’ve seen before.
Those affected call, rather than have it forced upon them (as is the case with traditional banks).
That is a very cool feature of Web3.
