The developers of PancakeSwap have proposed to reduce the maximum supply of its ecosystem token, CAKE, from 750 million to 450 million. 

Within hours of launching the voting process on Thursday, December 28, 2023, the proposal garnered massive support from the community, with over 95% approval from the PanCakeSwap community.

At the time of reporting, a total of 732 users participated in the voting process, with an overwhelming 97.16% expressing support for the proposed token supply cut. A mere 2.84% opposed the measure. The voting panel is set to conclude on Friday, December 29, 2023, completing a 24-hour window since its initiation.

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Evolution of CAKE Token Supply

Since its launch in September 2020, PanCakeSwap's native token, CAKE, has had a net emission rate of 40 per block, resulting in an annual inflation rate of approximately 80%. This rate has steadily decreased over time. CAKE tokens are distributed to users as part of staking rewards. 

The proposed token supply cut is intended to bring "certainty to the community" regarding the future CAKE token supply, particularly after experiencing significant inflation during the DEX's ecosystem bootstrap phase.

If the proposal receives final approval, the token supply cut will be executed by January 4th, 2024. According to the PanCakeSwap team, this reduction is anticipated to positively impact the CAKE token's value, potentially reversing the prolonged losses in its price. 

The adjustment is also expected to enable the provision of more accurate incentives for investors by aligning the token supply with community-driven goals.

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PanCakeSwap's Ongoing Developments

This token supply cut proposal marks another significant development for PanCakeSwap, following its expansion to the Coinbase-incubated Base layer-2 network and the Ethereum layer-2 scaling network Linea in August 2023. The move aligns with the platform's broader strategy of multi-chain expansion.

According to CoinMarketCap, CAKE is currently trading at $3.77, an increase of 6.8% within the day and a 40% increase within the past seven days.