Pancakes Are on the Menu: A Quick Guide to Get You Started with PancakeSwap

Pancakes Are on the Menu: A Quick Guide to Get You Started with PancakeSwap

23 August 2023

The world of DeFi (decentralised finance) – a new, blossoming financial landscape where users have access to a wide range of financial services without the need for centralised intermediaries – is growing quickly. 

One of the most popular DeFi platforms today is PancakeSwap, which has quickly become one of the leading decentralised exchanges (DEX) and is presently ranked among the top 10 DEXs by trading volume.

This guide will give you an overview of how PancakeSwap works and what you can do with it. With just a few simple steps, you’ll be well on your way to taking full advantage of the platform and all its features.

Key Takeaways:

  • PancakeSwap is a decentralised exchange built on the Binance Smart Chain that enables users to trade digital assets and cryptocurrency in a trustless environment with low fees.
  • PancakeSwap eliminates the need for order matching, allowing users to trade one token for another almost instantly through an Automated Market Maker system.
  • PancakeSwap offers a unique and convenient platform where users can trade tokens, earn rewards through Yield Farming and Staking, participate in NFTs trading, and potentially win a prize from the lottery.

What is PancakeSwap?

PancakeSwap is a decentralised exchange built on the BNB Smart Chain. It enables users to trade digital assets, including non-fungible tokens (NFTs) and cryptocurrency, in a trustless environment with low fees. As an automated market maker (AMM), PancakeSwap pools liquidity from many traders, providing liquidity on demand to users who wish to trade with one another.

PancakeSwap specialises in the BEP20 token standard, which is a set of requirements for new tokens to be compatible with the Binance ecosystem. This includes wallets, decentralised apps (DApps) and other services that function within the broader network.

How Does PancakeSwap Work?

At its core, PancakeSwap is a decentralised exchange (DEX) that uses an AMM system to facilitate trades without an intermediary or order book. Instead of trading with counterparties, users trade against liquidity pools. These pools are created by investors worldwide who deposit their funds into smart contracts to provide liquidity.

Fast Fact:

  • Those who participate in a liquidity pool are called Liquidity Providers. For the contribution of their assets to these pools, users receive LP tokens.

This system eliminates the need for order matching and allows users to trade one token for another almost instantly. All they have to do is put in the token they want to exchange and then withdraw the desired token from the pool without having to wait for a buyer or seller. In addition, PancakeSwap offers its users access to staking and yield farming opportunities, allowing them to earn rewards for providing liquidity.

Pancakes Are on the Menu: A Quick Guide to Get You Started with PancakeSwap

What PancakeSwap Can Offer You

PancakeSwap is a great platform for traders and investors of all levels. Not only does it offer the chance to buy and sell tokens, but you can also take up the role of a liquidity provider. By depositing tokens into a pool, you have the opportunity to earn a share of the trading fees paid by those trading against the pool.

Yield Farming

Yield Farming is an attractive opportunity available on PancakeSwap. With this, users can farm and earn rewards in the form of a token called CAKE – the native token of the platform. 


Staking is another great opportunity to earn on PancakeSwap. By depositing a specific amount of tokens into a staking pool, you can receive additional CAKE tokens and maximise your profits in the long run. It’s important to note that staking pools have their own unique terms and conditions, so conducting thorough research before committing your funds is highly recommended.

Also, if you are not sure how Yield Farming and Staking differ, check out this article.

NFTs Trading

PancakeSwap also offers the chance to trade special Non-Fungible Tokens. These are digital tokens which are unique and indivisible and are used to represent virtual items such as artwork or collectables.

Lottery and Other Services

Those who are looking for an extra thrill can also participate in the lottery on PancakeSwap. All you have to do is guess correctly from a set of numbers, and if you get it right, you could find yourself winning a hefty prize. In addition, PancakeSwap offers other services, such as game integration and trading competitions.

Pancakes Are on the Menu: A Quick Guide to Get You Started with PancakeSwap

First Preparations

Have a Crypto Wallet

Setting up a wallet compatible with BNB Smart Chain is the first step needed before being able to use PancakeSwap. Luckily, there are several excellent options available for users to choose from:

Trust Wallet

Trust Wallet is the leading decentralised crypto wallet that provides a secure, intuitive and simple user experience and is possibly the best option when it comes to hot crypto wallets for your smartphone. It integrates seamlessly with Binance and PancakeSwap & supports a wide variety of cryptocurrencies, including Bitcoin, Ethereum, Binance Coin, ERC20 tokens & BEP20 tokens. With its built-in DEX feature, users can easily exchange and trade tokens within the wallet. 

Trust Wallet also offers integration with DApps & access to the vibrant DeFi sector. Its robust security measures include biometric authentication and encrypted private key storage, ensuring maximum protection of user funds.

Coinbase Wallet

Coinbase Wallet is an easy-to-use crypto asset wallet that supports hundreds of thousands of assets. It seamlessly connects to PancakeSwap, giving users complete control over their digital assets and wallets. With the Coinbase Wallet app, users can store Bitcoin securely offline and access a variety of features such as buying and selling crypto, setting up recurring payments, earning interest on their deposits, and more.


MetaMask is another popular option that supports the best ERC20 tokens, connecting to Rocket Pool and Lido for staking Ethereum 2.0. Additionally, users can manually add a selection of other networks, including Polygon, Binance Smart Chain, and Optimism. MetaMask is designed for the optimal user experience, with an intuitive interface that allows users to securely store their own crypto assets without relying on any third parties.

Other Binance Chain Wallet

There are several other wallets compatible with BNB Chain, including Binance Wallet, TokenPocket and SafePal. These wallets offer different features, such as DApp access or support for additional tokens and currencies. It is important to compare the features of each wallet before choosing one to make sure it meets your needs.

Pancakes Are on the Menu: A Quick Guide to Get You Started with PancakeSwap

Connect Wallet to PancakeSwap

Once you have chosen your wallet, it is time to connect it to PancakeSwap. For different wallets, the process may differ slightly, but overall it is quite straightforward.

For example, if you want to connect Trust Wallet on your Android device, then:

  • Open Trust Wallet 
  • Tap “Dapps” and look for the “PancakeSwap” option
  • Accept the terms and conditions 
  • Tap ‘Connect’ to connect your wallet with PancakeSwap. 

For step-by-step instructions on integrating your specific wallet with the platform, refer to the comprehensive guide provided by PancakeSwap. This article provides detailed instructions on connecting any wallet listed above.

Pancakes Are on the Menu: A Quick Guide to Get You Started with PancakeSwap

How to Add Liquidity on PancakeSwap and Get CAKE Tokens?

If you’re ready to take the next step in your BNB Chain journey, why not add liquidity to one of the pools available on PancakeSwap? The platform allows users to get started adding liquidity right away. Here’s how to do it: 

Head over to the Trade section at the top right corner of PancakeSwap’s homepage and select “Liquidity” from the dropdown menu. Once here, click the “Add Liquidity” button and choose your desired token pair. You’ll need to deposit both tokens into the pool according to a predetermined ratio.

Then sign the transaction using your wallet. Once your transaction is successfully completed, you’ll be given LP tokens that indicate how much of the liquidity was deposited in the chosen pool. 

Pancakes Are on the Menu: A Quick Guide to Get You Started with PancakeSwap

Yield Farming on PancakeSwap

Yield Farming on PancakeSwap is a great way to make passive income. All you need to do is provide liquidity to one of the pools, and you’ll be rewarded with CAKE tokens for your liquidity contribution. 

To get started, head over to the PancakeSwap homepage and click on the “Earn” menu. From there, select “Farms”, and you’ll be taken to a page where all available farms will be listed. 

Here, you can scan through the offerings and decide which farm is best suited to the LP tokens you currently possess. It’s important to consider both the annual percentage rate (APR) and rewards offered, as these will significantly affect your total returns.

Pancakes Are on the Menu: A Quick Guide to Get You Started with PancakeSwap

When you’ve made your choice, hit the “Enable” button and confirm on your wallet. Then, the switch will flip to Stake LP – click here to enter the amount of LP token you wish to stake. Make sure all details are correct before confirming the transaction. Once that’s done, hit “Confirm” and your wallet will prompt you to sign off on the transaction.

You can find your staked LP balance at any time on the “Farms” page, which will display exactly how many tokens you have currently staked. When it comes to withdrawing your staked LP tokens and any earned rewards, you can simply click on Harvest. 

Staking on PancakeSwap

Staking on PancakeSwap is an easy and rewarding process.

To begin, click on the “Earn” drop-down menu from the home page of your account and select “Pools”. This will take you to a list of available Syrup pools where you can stake your CAKE token. 

Pancakes Are on the Menu: A Quick Guide to Get You Started with PancakeSwap

For each Syrup pool, you will be able to see the annual percentage yield (APY), total amount staked, and all the details necessary. Select the pool that best suits your needs.

Once you’ve chosen a pool, click the “Enable” button to start staking. Enter the amount of CAKE you wish to stake and confirm your transaction. Depending on which pool you have chosen, your earnings can be automatically collected and re-staked in the same pool.

Win in the Lottery on PancakeSwap

PancakeSwap offers a lottery system where users can compete for rewards.

Each session takes six hours to complete and requires 10 CAKE as an entry fee. After submitting the ticket, users will receive a unique four-digit combination of numbers ranging from 1 to 14 – such as 3-7-1-10. To win the grand prize – which is 50% of the entire lottery pool – all four numbers in your ticket need to match the same position as those of the winning ticket.

However, even if you don’t get a full match, there are still rewards to be won. If two or more numbers on your ticket have the same position as those of the winning ticket, you will still be eligible for a prize.

Pancakes Are on the Menu: A Quick Guide to Get You Started with PancakeSwap

Buy NFTs on PancakeSwap

By participating in activities on PancakeSwap, users can buy special NFTs. These NFTs are both rare and incredibly cute, making them highly desirable among collectors looking for something unique.

To start trading NFTs, click on the “NFT” at the top of the homepage. This will take you to the NFTs page, where you can explore a wide variety of collections from different creators. You can browse through the collections and use the filters to narrow down your choices. Once you have found the perfect NFT, click on it and purchase it using BNB tokens.

If you’re interested in getting involved with PancakeSwap’s NFT offerings, make sure to keep an eye on the NFT page as new opportunities are frequently added. Be sure to act quickly, however, as these tokens have a limited supply and can be snatched away in a matter of seconds.

Pancakes Are on the Menu: A Quick Guide to Get You Started with PancakeSwap

Last Words

As you can see, PancakeSwap offers a wide range of features that make it an ideal platform for those looking to get involved in the world of DeFi. The platform offers a cute and intuitive interface that makes it easy to get started with any of its features. Whether you’re looking to add liquidity, earn passive income through farming and staking, or purchase unique NFTs, PancakeSwap may be a perfect choice for you.


Is it safe to use PancakeSwap? 

PancakeSwap has been subjected to an audit by CertiK, a renowned blockchain security firm founded in 2018 by professors from two prestigious universities, Yale and Columbia.

Despite this, as with any smart contract, there is a risk of bugs that could potentially cause the loss of funds, even in projects that have undergone rigorous audits and are highly reputable. Therefore, it is best to only deposit funds that you are comfortable with and can afford to lose, should anything go wrong.

What are the advantages of using PancakeSwap?

PancakeSwap offers users several advantages, including low gas fees, easy access to liquidity pools, and an interface that is both intuitive and user-friendly. Additionally, PancakeSwap provides the ability to stake CAKE tokens and earn rewards in exchange.

What is a liquidity pool and how can I participate in one? 

A liquidity pool is a virtual collection of funds from multiple users that are pooled together and then used to facilitate crypto trading. Users can participate in these pools by providing assets to the pool in exchange for LP tokens.

Are there any fees involved in using PancakeSwap?

PancakeSwap provides users with a fee structure that is far more competitive than centralised exchanges such as Binance. Its tiered system includes fees ranging from 0.01% to 1% depending on asset type, trading frequency, impermanent loss levels and volatility. Stable pairs offer the lowest fees.

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