Cakepie DAO Opposes PancakeSwap's Tokenomics 3.0, Citing Lack of Transparency and Potential Governance Attack

Cakepie DAO, a significant player in the PancakeSwap ecosystem, has expressed strong opposition to PancakeSwap’s Tokenomics 3.0 proposal. This proposal includes plans to retire veCAKE, staking, gauges voting, and revenue sharing, which has sparked significant debate within the community. Cakepie DAO, the largest veCAKE holder and a long-time contributor to PancakeSwap’s growth, has voiced deep frustration over the proposed retirement of veCAKE, a governance mechanism designed to reward long-term commitment and align incentives across the ecosystem.

Cakepie DAO’s primary concern is the manner in which the proposal was announced. Despite locking millions of CAKE tokens for four years and consistently contributing to liquidity growth, Cakepie claims it was blindsided by the changes, learning about them at the same time as the general public. This abrupt change undermines not only Cakepie’s efforts but also the trust of the broader BNB Chain builder community. Cakepie, which has locked in 13 million CAKE, emphasized that removing veCAKE would erase their commitment overnight.

PancakeSwap’s rationale for its Tokenomics 3.0 proposal centers around a vision of deflationary growth, revenue efficiency, and protocol simplicity. The new model targets an ambitious 4% annual deflation rate and aims to cut daily CAKE emissions from 40,000 to 22,500. This marks a continuation of the exchange’s deflationary trend, following a 2.7% reduction in CAKE supply last year. PancakeSwap developers argue that veCAKE has failed to live up to expectations, pointing to an overly complex governance system, inefficient capital allocation through bribed votes, and the misalignment between emissions and revenue generation.

PancakeSwap also proposes unlocking all staked CAKE without penalties and redirecting all fees that were previously shared with stakers toward burning CAKE instead. They claim the goal is to simplify the user experience, reduce costs, and build a protocol that delivers real yield through increased trading volume and reduced token inflation. However, critics argue this comes at the cost of decentralization. veCAKE was designed to reward those who locked CAKE for long durations, granting them more influence in governance and directing emissions through gauges voting. Critics say that by removing veCAKE, PancakeSwap would shift influence away from long-term believers toward whales and short-term holders.

Adding fuel to the fire, Cakepie raised serious concerns about the governance process leading up to the proposal. The DAO claims that roughly 25 million CAKE tokens were locked across multiple wallets shortly before the Tokenomics 3.0 announcement, potentially orchestrating a governance attack. If true, this would allow participants to vote for the proposal and immediately unlock their tokens if the changes pass, undermining the spirit of fair participation. The DAO warned that a compromised governance process undermines trust and must not be overlooked.

Instead of scrapping veCAKE entirely, Cakepie offers a number of constructive alternatives. Among them are direct rewards to pools that generate real value, allowing veCAKE holders who vote to receive a portion of the trading fees, and letting users exit early from veCAKE lockups in exchange for a penalty, preserving the incentive to commit while increasing flexibility. These options, Cakepie says, would address efficiency concerns while preserving the integrity of long-term tokenomics and governance. For now, the coming days of the vote will determine the way forward from here.