- CAKE’s value increased by 21% due to the new proposal.
- A potential approval may put CAKE in pole position for a rally.
Decentralized exchange PancakeSwap [CAKE] has proposed to reduce the maximum supply of its native token from 750 million to 450 million.
According to the project, the move is necessary if the token wants to move from a high-inflation model to a more efficient one.
While the proposal would still undergo discussion, comments from the PancakeSwap forum showed that some members of the community were in support. The major reason for the backing is that the decrease in supply might trigger a jump in CAKE’s value.
Icing on the veCAKE
Furthermore, the proposal seemed to align with the launch of veCAKE.
A few weeks ago, PancakeSwap launched veCAKE, which stands for vote-escrowed CAKE. veCAKE is the non-tradable and non-transferrable version of CAKE.
During the deployment, PancakeSwap noted that the token would enable active participation in the project’s governance.
So, it is possible that veCAKE would be crucial in determining the outcome of the latest proposal. At press time, the total supply of CAKE was $236.71 million.
The result of the disclosure was a positive one for CAKE. As of this writing, the cryptocurrency’s value has increased by 21.16% in the last 24 hours.
The increase seemed like a much-needed one for CAKE holders. This was because, unlike its peers, CAKE’s 365-day performance was in the red. Should the proposal be approved, the tides may change for the cryptocurrency’s price action.
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Author: Victor Olanrewaju
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