Should you invest in CAKE in 2022? Image credit: AdobeStock
The real luck of an investor is to find the best asset, the best time to enter the market and the best time to exit the market. It is already extremely expensive to buy Bitcoin now, even in the current recession, and therefore it makes sense to look for promising inexpensive altcoins. One of them is CAKE, the token of the PancakeSwap platform.
PancakeSwap is nothing more than an automated market maker, a decentralized exchange platform where tokens can be exchanged. Unlike centralized exchanges, there is no order book, offer and ask price corridors, exchange and limit orders. Instead, users provide liquidity to the pool and thereby form new token markets. Liquidity providers are rewarded in LP tokens.
The PancakeSwap protocol is based on Binance Smart Chain. Some users of DeFi services have already appreciated its advantages: fast confirmation of transactions and low fees. Leading trades are prohibited on the platform. Among the additional features of PancakeSwap are the oracle market, lottery, farming, and the first farming offer.
The PancakeSwap project was launched in the fall of 2020. At launch, the token was worth $1.1. Soon the price dropped and for the next several months CAKE traded well below the dollar mark. At the end of January 2021, explosive growth began. The coin peaked above $18 and after a slight correction went to new heights. The historical maximum was recorded at the end of April. CAKE cost just over $42. Due to the synchronous volatility of the cryptocurrency market, this period was marked by highs relative to other cryptocurrencies. The CAKE/ETH exchange rate at its peak was 1:0.016.
The summer recession of the market did not bypass CAKE either. After reaching a local maximum of $12.02, the coin began to grow again, in August it traded above $20 for some time.
Since then, the price of CAKE has been decreasing relatively smoothly, and at the time of writing, the token is trading at $7.66. This is below the six-month low and roughly corresponds to the level from which the explosive growth began.
Due to the youth of the project, it is still premature to draw any conclusions about the prospects of the coin based on the price history. The current situation in the cryptocurrency market can become both a harbinger of a further catastrophic collapse, and a respite before a new bullish rally.
One way or another, but 2022 will not be an easy year for the crypto market as a whole. The optimistic scenario for CAKE is a recovery and growth to $19.6 during 2022. With the recovery of the uptrend, a gradual increase is predicted with intermediate targets of $22.4 in 2023, $27 in 2024 and up to $39 in 2026.
Given the affordable price, CAKE can be considered a potentially profitable investment. However, before investing in cryptocurrencies, do your own research and be prepared for a variety of surprises.
The coin is traded on the Binance, Gate.io, Tokocrypto, CuCoin and other exchanges. The token is also available on the Letsexchnage – cryptocurrency instant exchange online, where over 350 coins can be exchanged for CAKE.