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Pancakeswap leaders propose cutting CAKE token inflation target to 3% to 5% (https://www.coindesk.com/business/2023/04/18/pancakeswap-leaders-propose-cutting-cake-token-inflation-target-to-3-5/).

Pancakeswap is one of most common and biggest decentralized exchanges. Its token $CAKE was traded over $40 in DeFi 2.0 hype 3 years ago but now it is less than $2. Weeks ago, I thought price around $5 to $6 would be its bottom price and it will stuck there before a bull run of Bitcoin.

I am shocked when I checked the chart a few days ago and saw its price even fell to about $1.5 before recovering to $1.7.

I believe cutting inflation is a very good tokenomics change and it would have positive impact on $CAKE price.

What happened? What did you know?

Please share.

These might be the reasons

1. Cake rewards are always getting slashed. It forces starkers to exodus into the new platform that offers decent reward like me, i have been moving from cake to the new platform.

2. There have been many new platforms came to the market. The demand being divided to the new platform as well.

3. TVL is also always decreasing from time to the time  (https://defillama.com/protocol/pancakeswap?tokenLiquidity=true&newUsers=true&transactions=true&gasUsed=true&tvl=true)

I don't know much about why the price of $CAKE has decreased from time to time, but seeing the current situation in the crypto space where more and more platforms that offer more advantages are popping up, I'm not surprised that the price drop happened. As a result of these new platforms (especially on different chains), causing the TVL of the $CAKE ecosystem to be divided between these platforms. That's the most rational reason at this time.

It's no guarantee for the price movement.

It's always like that, cutting inflation is to avoid the increase in tokens on the market. However price are not guarantee gonna to be increase, take example like: The inflation are dropped but the market cap decreases.

Then, the price are gonna to be down even the inflation token are down. Sentiment from "Global-Crypto" market are also one of indicator.

When CAKE drops to $1.7, it's like watching your TV darling get whacked – it's a full-blown "WTF?" moment, right?

In the soap opera of DeFi, market sentiment swings harder than a prima donna in a Wagnerian opera. It's all "Carmen" one minute, "La Traviata" the next. PancakeSwap's scheme to throttle CAKE token inflation might spice things up positively, but let's not hitch our wagons to a rocket yet.

Bear in mind, DeFi ventures are heavily anchored in utility and community confidence. Perhaps there's some backroom hocus-pocus afoot, like glitches in the PancakeSwap algorithm, shift in market winds, or puppeteering by crypto leviathans. The blockchain reality ain't a stroll down certainty lane, folks. Be a hawk, be savvy!

It became very popular with the defi wind, and they even surpassed Uni Swap as TVL for a while. I think the platform did not fully develop itself, they created an opportunity, but they could not protect it.

After a year of unlocking, there was an excessive amount of sales, which had an effect. Otherwise, I didn't think it would drop below $3 during bear season.

It’s value decreases a lot after they decrease the APR last year when the price dipping. The existence of new DEX on different makes the recovery of $Cake is very slow. There’s only few holders now compared before while the token supply keep increasing. I think the current price is the normal price for this token without the hype since the marketcap is still above 1B.

I think one main contributing factor on why Cake dump hard this past months is because those 1Year stake plan is already unlock and sold in the market.

I think the level he is at now is a level that should be. After the locks were opened, the big sales came and went down to this level. I don't think it will go down any further, so it will form the basis for these price ranges. I didn't think it would fall here so soon after unlocking, but it did. It has lost its popularity due to the transition to many different platforms.

I think it will gain popularity again. This takes some time. But if you're thinking of investing, do your own research because there are no known reasons for the decline other than for two reasons.

1- Sales after unlocking.
2- The emergence of other platforms.

I have thought as well that it could be the bottom so I did a few of it but little did I know that there will be more and deeper bottom of it.

This is right, the demand has decreased and that's because of the emergence of other new platforms where people have liked it. The exchanges token have been on hype and we saw how they've made a lot of attention and thus, the prices have become high from it. While those that have been staked and in locked period, when they're able to take it then there goes the massive sale that no one want to miss as they see the price drop.

I know the potential impacts from lower capital in Pancakeswap TVL. It is basic but I think that Pancakeswap is one of best decentralized exchanges, it is only after Uniswap. I only want to use trusted DEX, not new ones and don't know quality of their security. New DEX needs to be tested by the market and hackers and I don't feel safe with them.

I know because with same total supply, price of two tokens can be very different. Halving, deflation models can not show instant impacts but in the long run I believe it will have impacts.

Altcoin projects are funny in how many transaction fees spent on their games (like GameFi projects) and after the fomo disappears, inflation goes up, selling pressure goes up, their token price drop a lot and their marketcap will even become smaller than total value of ETH or BNB for transactions fee of all transactions in their games.

I think that proposal is good and a next bull run with Bitcoin, $CAKE will be one of good altcoins if we want to invest in native tokens of decentralized exchanges.

Yes it's about you, but what about other people? Of course, each of us has a different point of view regarding the new DEX, some see it as something insecure (like you), and some see it as a new opportunity to invest in low TVL ecosystems. Take a look here (https://defillama.com/protocols/Dexes), mate. You can see that one of the chains on Pancakeswap DEX has decreased TVL by more than 50% in the past month.

Exactly. If you're not a market mover then it doesn't really matter what you think of Pancakeswap or new DEXes. What's clear is that people want high rewards and they are ready to gamble on that so cutting inflation a number of time is probably not ideal when you have plenty of competitors.

The thing that makes it possible is the trust of investors, the price drops drastically that often happens because many people leave the token, one of the possible reasons is because of the many scam projects that have entered their pancake swaps or decentralized them.

Believe me or not. You will be seeing the TVL will be dropping so even further if the community keeps slashing the reward. Inflation cut proposal will not make people interested to go back again to the pancake swap.

It can be seen that if TVL from pancakse swap redistributed to the another platform that based on different blockchain.

I think inflation matters and this should help them without a doubt. But, we are also talking about losing the DeFi hype overall as well. It's still there, it still exists, but it's gone beyond the bear market of the crypto world as well. If it was just bear market that made it go down like this, I would have expected something like 5 to 10 range as well, that would make sense.

The extra drop from there was just the DeFi world not having the same amount of attention that it used to have. When people lose attention to something, they start looking for other stuff and that is why it has been dropping significantly. If there is a recover at defi world one day in the future then maybe we can see this get better again, but until then it's going to be like this.

I don't know the one reason why Cake has fallen to such a low price and i although think that there is not the one single reason why this happened and instead it is a mix of different things. First of all obviously all the projects are going down at the moment not only cake. Of course some projects have lost more than others but overall pretty much every project has lost some value.
Another reason could be the fact that the BNB chain is not the most hyped chain anymore. It seems like Arbitrum took that spot from the BSC chain and obviously cake is also suffering pretty heavily from that fact as it is the biggest DEX on the BSC chain.

This token is not much traded. Because there are not many exchanges available. Maybe their buyers have reduced. So slowly the price has started to decrease. It entered the market as a good token once.