A few years ago, investors bought cryptocurrencies and kept them in cold wallets until the coins rise in price. If someone did not want the capital to lie dead weight, then he had to go to the exchange to increase his crypto-assets, playing on the market volatility. The business is quite risky and not suitable for everyone.

But after the advent of Defi projects, making money on cryptocurrency has become much easier. Now everyone can earn income by sending digital coins to liquidity pools. In this article, we will compare PancakeSwap and Uniswap.

What is Uniswap

Uniswap is a decentralized cryptocurrency exchange built on the Ethereum blockchain, according to buidlbee. It enables users to convert ETH to ERC20 tokens and the other way around. A trustless, permissionless platform, Uniswap is unusual in that it uses smart contracts to automate the exchange of cryptocurrencies. Uniswap can therefore be used by anybody to buy or sell tokens without the need for a centralized exchange.

Advantages and disadvantages of Uniswap

The site has its advantages and disadvantages. Let’s get to know them better.

Pros

  • There are a huge variety of available cryptocurrencies;
  • The interface is simple and understandable even for a beginner;
  • There is no need for registration;
  • It is possible to earn passive income;
  • The code is open and transparent.

Cons

  • The commission of the system is high when compared with centralized exchanges;
  • There is no possibility to work with fiat currency;
  • The yield of the pools in annual percentages is not disclosed to anyone;

For full-fledged work with the platform, the cryptocurrency is purchased from other exchanges and exchangers, and after that it is entered into the system.

What is PancakeSwap

Pancakeswap is a decentralized marketplace that uses an automated market maker to enable clients to connect to liquidity pools built on the BCS blockchain. The Exchange PancakeSwap project is a direct competitor to the Uniswap platform. But unlike its Ethereum-powered counterpart, PancakeSwap finance uses the faster and cheaper Binance Smart Chain in terms of fees.

Farmers and syrup holders work here, and rewards are paid in cakes. No, of course, we did not mean confectionery in color boxes at all. It’s just that the base coin of the PancakeSwap system is called CAKE, which means cake in English. Various food names are very popular with defi developers for some reason, and now it’s time for packenswap, where you will find a lot of cakes, pancakes, syrup and rabbits spinning the lottery drum.

Pros and cons of the PancakeSwap

PancakeSwap is currently one of the most active AMM projects with a wide range of services and fairly high liquidity. Using Binance Smart Chain gives you an edge over Ethereum-powered competitors. If you read the reviews, you can conclude that most customers are satisfied with the work of the exchange. Here you can work anonymously, and the commissions are lower than on other services. CAKE token holders can vote on the direction of development. The platform has been audited by cybersecurity company Certik.

At first glance, there are no significant shortcomings. However, you need to understand that this is a decentralized platform using smart contract technology, so you cannot be completely free of vulnerabilities. Don’t invest more money than you’re willing to lose. Not a single modern blockchain project is immune from bankruptcy or a massive hacker attack. And one more thing, after the full launch of the updated Ethereum network, it will be more difficult for packenswap to compete with Uniswap and other similar projects.

Overview of UNI and CAKE

Both PancakeSwap and Uniswap are deployed on separate networks, with PancakeSwap being deployed on Binance Smart Chain and Uniswap being deployed on Ethereum. The bottom line is that they don’t compete with one other and provide a clearly different selection of cryptocurrencies for exchange.

Fees

The commission rate for PancakeSwap is 0.25% per trade as opposed to 0.3% per deal for Uniswap. It is critical to remember that due to high gas expenses, transactions on the Ethereum blockchain are substantially more expensive. This implies that PancakeSwap token transfers are typically less expensive.

Security

Actually, PancakeSwap and Uniswap use the same codebase. Since PancakeSwap is a fork of Uniswap (v2), they both offer many of the same security assurances.

Uniswap is the safest dapp you can use because it is the biggest DEX in terms of volume and usage. As a result, PancakeSwap is equally dependable and safe.

‍Summary

In our article, we compared the two leading exchanges. We tried to tell you about the features of each of them, pluses and minuses. Before using and starting to work on them, we recommend that you once again familiarize yourself with all the nuances more carefully.

This article was provided by Daniel Brunson