- CAKE price has crashed in the past six straight days.
- There are lingering concerns about Binance FUD.
- NFT and DeFi trading volumes have plunged recently.
CAKE price collapsed to the lowest level since July as concerns about the Binance Smart Chain (Bsc) ecosystem continued. PancakeSwap’s token crashed to a low of $3.50, which was about 35% below the highest level on November 8.
Binance FUD concerns
PancakeSwap is one of the biggest players in decentralized finance with a total value locked (TVL) of more than $3.2 billion. At its peak, it had over $12 billion in total assets.
Like Uniswap, PancakeSwap makes it possible for people to trade digital currencies in a decentralized manner. In addition to these swapping tools, the company provides other solutions like an NFT marketplace, a betting platform, and a yield farming solution.
Pancakeswap is the biggest dApp in the BNB Smart Chain. Its Ethereum and Aptos platforms are relatively smaller. According to its website, it has over 1.9 million users in the past 30 days. It has executed over 55 million trades in the same period and has $6.1 billion in staked value.
DeFi protocols like PancakeSwap and GMX are benefiting from the collapse of FTX. Many advanced traders are moving to centralized exchange venues to decentralized ones, which are seen as being safer options.
DEXes are decentralized, open-source, and highly transparent networks. With everything being in the on-chain, anyone can track transactions in real time. Further, CAKE holders take part in its governance.
A key challenge that PancakeSwap is having is its association with Binance, the biggest exchange in the world. In the past seven days, Binance’s customers have withdrawn over $7.7 billion in assets amid concerns of a FUD. Analysts believe that increased scrutiny could lead to strong outflows in BNB chains.
On a positive side, PancakeSwap introduced farming features on Aptos, the new blockchain. The service will make it possible for users to earn CAKE while supporting PancakeSwap by staking LP tokens.
CAKE price prediction
The daily chart shows that the CAKE price has dropped in the past six straight days as investors worry about the Binance FUD. It has dropped below the 25-day and 50-day moving averages. Most importantly, it moved slightly below the important support level at $3.54, which was the lowest level on November 23 and August 19.
The Relative Strength Index (RSI) has moved to the oversold level. Therefore, with stocks also dropping, there is a likelihood that the coin will continue falling as sellers target the next key support at $3, which is about 15% below the current level.
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