Table of Contents Hide
With Uniswap and PancakeSwap being favorites to multiple traders around the world, people want to know which one is better and which they should invest in.
The aim of today’s article is to give you a deep insight into both exchanges, along with the pros and cons of each one to help you make an informed and wise decision.
Let’s get into it!
What Is Uniswap?
Uniswap is the most successful decentralized exchange in the world. It executes trades by utilizing ground-breaking Automated Market Maker technology and runs on the Ethereum blockchain.
Coinbase’s whole trade volume was notably flipped by Uniswap in the year 2020. The milestone served as a defining turning point in the progression of DEX technology from a novel concept to the sector’s inevitable future.
Liquidity plays a significant role in the process through which Uniswap facilitates deals. To this day, Uniswap’s liquidity pools hold crypto assets with a total value of approximately $6 billion, which were bought and sold on the exchange. Despite the fact that this number is far lower than its all-time high of over $8 billion, there is more than enough liquidity for any trade that can be imagined.
Besides, the cheap coins on Uniswap are not only affordable but also the best ones there are currently!
What Is PancakeSwap?
The largest decentralized exchange and yield farming platform on the Binance Smart Chain is none other than Pancake Swap!
PancakeSwap gives liquidity providers access to a wide variety of DeFi farming opportunities in order to facilitate the creation of liquidity pools. Since PancakeSwap opened its doors, it has been able to attract well over one billion dollars’ worth of total value locked (TVL), making the liquidity grab a resounding success up to this point.
However, in contrast to Uniswap, PancakeSwap provides incentives to users who invest in its native BEP-20 coin, which is denoted by the symbol CAKE. You will receive SYRUP in proportion to the amount of CAKE that you stake. Having SYRUP grants you the right to receive 25% of the CAKE emissions, which are doled out in accordance with the number of holders.
Comparing Uniswap And PancakeSwap
Both exchanges look the same at first glance, but when you take a deeper dive into how they operate and what they offer, you realize there are staggering differences between the two.
Trading Volume And Fees
When Ethereum prices sky-rocketed, traders had no other options but to look for alternatives, like Uniswap. PancakeSwap was prepared for the move away from Ethereum apps since BSC had already spent months marketing itself as a low-cost rival. This allowed PancakeSwap to be ready when the migration began.
During one extremely busy day, PancakeSwap obtained 2 million transactions, whereas Ethereum and Uniswap combined only racked up 1.5 million transactions. PancakeSwap’s trading volume surged to such an extent that it briefly overtook Uniswap as the world’s largest decentralized exchange in terms of the trading volume.
The primary difference between their website’s interfaces is the structure and color. Uniswap places a high priority on maintaining a minimalistic and clear interface, with a primary concentration on the trading mechanism itself.
The PancakeSwap website utilizes brighter colors and has an overall comical aesthetic, complete with characters of various animals and a crowded menu.
This doesn’t have anything to do with how much they’re worth or what they can offer you, it’s mainly based on design and preference.
The process of exchanging feels essentially the same in each of the transactions. You will need to connect a Web3 wallet, such as MetaMask, to each one individually.
On the other hand, Uniswap earns points in this category due to the fact that MetaMask natively supports Ethereum out of the box. In order to use MetaMask with PancakeSwap, you will need to manually input the parameters needed to connect to the Binance Smart Chain.
PancakeSwap comes out on top when it comes to ease of use and user experience, but Uniswap is the clear winner when it comes to the speed of trade. Since Binance Smart Chain is capable of processing a higher volume of transactions per second than Ethereum, PancakeSwap is able to expedite the completion of trades.
Depending on the amount of gas expense that is paid, Uniswap deals can occasionally take up to five minutes to complete. Due to this, both Uniswap and PancakeSwap provide users with an equally satisfying experience despite the fact that one exchange provides advantages that are superior to those of the other.
At this time, Uniswap does not provide an option for yield farming in the traditional sense of the term. On Uniswap, the sole way to generate yields is to collect trading fees from liquidity pool tokens. This is the only way yields can be earned.
PancakeSwap, on the other hand, gives users an extensive number of choices for DeFi farming.
There are also Syrup Pools available, in addition to the PancakeSwap Farms. These are pools with juicy returns that enable you to stake CAKE tokens in exchange for tokens belonging to BSC projects.
Lastly, you now have the opportunity to contribute liquidity to the PancakeSwap platform in the same way that you do on Uniswap.
If you’re keeping score, that brings the total number of primary methods you may earn yields on PancakeSwap up to three, while Uniswap just offers one.
Advantages And Disadvantages
Life isn’t always sunshine and rainbows, so in order to accurately answer the question of which one is the best, we need to mention the disadvantages that both exchanges have.
|Interface is sleek and tidy with a dark mode feature||No mining for liquidity or farming for yield|
|ERC-20 tokens for Ethereum have the most liquidity||It could be slow and pricey to use|
|First-mover benefit||Uniswap V3 encounters slippage issues|
|State-of-the-art security||UNI is a governance token|
|Cheaper and faster than Uniswap||Cluttered interface|
|Various yield farming options||Need to connect to Ethereum assets|
|User-friendly||Trading volume has decreased|
|Pools with a lot of liquidity||BSC has experienced numerous exploits|
It is up to the traders to decide whether or not they want to take the risk of trading on a controlled exchange like PancakeSwap or whether or not they can afford the high transaction charges that Uniswap imposes.
Both exchanges are currently working to improve their respective platforms, so keep an eye out on both of them as you never know what the future might hold!