Decentralized exchange PancakeSwap is gearing up to release the PancakeSwap v4 as part of its effort to improve its interoperability, scalability, and liquidity. This decision comes as the platform recently hit $836 billion in trading volume, necessitating the need for the said upgrade.
Notably, PancakeSwap has been in operation for around four years. While the exchange says it has now surpassed $836 billion in cumulative trading volume, it also currently boasts a total value locked (TVL) of about $1.72 billion.
For what it’s worth, though, the current TVL is a far cry from its May 2021 high of $7.16 billion. Although DefiLlama data shows that the TVL was still about $2.42 billion as of March 30, the value of tokens locked on the platform has been on a constant decline for most of the last 18 months.
The top BNB Chain DEX says more than 43 million cumulative unique addresses operate on its automated market maker (AMM) model. The exchange hopes that the new version will help to resolve its AMM shortcomings.
How PancakeSwap v4 Will Tackle AMM Challenges
The team expects PancakeSwap v4 to improve user experience and scalability. They also expect it to build on the exchange’s technical foundation with interoperability improvements and liquidity provision.
Chef Kids, head of PancakeSwap, has said that the current AMM model challenges include inflexible pricing models and limited trading features. Another interesting feature of the new version is that it will also reduce on-chain gas fees by creating more dynamic fee tiers.
Kids criticized many DEXs for having low functionality and user experience. With the new version, he believes PancakeSwap will fill an important gap in the market.
PancakeSwap also expects v4 to increase the platform’s trading volume as more users find trading easier. In Kids’ words, the new project will “focus on increasing capital efficiency and providing a streamlined interface for liquidity providers, which will attract more participants, enhance market depth, and lead to better price execution.”
More Chains to Host PancakeSwap’s DEX
PancakeSwap has released a $500,000 developer program to attract top tier builders ahead of its v4 launch.
PancakeSwap is available across nine chains: BNB Chain, Ethereum, Aptos, Polygon zkEVM, Zksync Era, Arbitrum One, Linea, Base, and opBNB. However, Kids says the project will expand to more chains as time goes on.
Interested applicants have until September 30 to submit their proposals for PancakeSwap’s v4 Hookathon on Dorahacks.
