Discussion on "PancakeSwap Affiliates" - a multichain expansion strategy

Governance
1

~tldr

Aims of the proposal:

  • To officially recognize and support 3rd party DeFi teams in deploying PCS’s core contracts to new chains that the Kitchen doesn’t have the bandwidth to invest resources in, under their own brand name and token
  • To earn increased revenue from affiliated DEXs and fund future core development initiatives around the PCS exchange managed by the Kitchen
  • To better access native token volumes on new chains, with a team that is more native in these new chains and who can react faster to the chain’s unique developments and needs

High-level structure of a recognized Affiliate fork (“XXX DEX”):

XXX DEX provides

  1. “XXX DEX” follows the core PancakeSwap operating structure including
  • LP fee
  • token incentives for LPs
  • buy-back of the DEX token + burn mechanism.

The % of each category is to be determined by the forking team in consultation with the Kitchen

  1. XXX DEX allocates X% of supply to the PancakeSwap protocol, of which Y% of supply to veCAKE stakers (to be agreed with individual teams)

  2. XXX will pay PCS Z% of all deployed product revenues (e.g. ongoing LP fee revenues) periodically to PancakeSwap

PancakeSwap provides

  1. Recognition of XXX DEX as part of the PancakeSwap “affiliate/extended network” with a link to the DEX under our supported networks on the PancakeSwap webpage

  2. Full set of PCS-developed products without reliance on external partners (e.g. Perpetuals, veCAKE managers) with deployment guidance to help get XXX DEX set up, along with PCS’s other DeFi products

  3. 6-month exclusivity for PCS not to deploy on the chain that XXX DEX is deployed to from the initial deployment date, to ensure that XXX DEX and PancakeSwap are aligned on interests.

  4. After 6 months, so as long XXX DEX stays in the upper quartile (i.e. top quarter) by trading volume on the native chain, PancakeSwap shall not deploy a native version on that blockchain to compete with XXX DEX.

  5. Future provision and tech support for any upcoming DEX upgrades, if any, and/or more native frontend integration into the PancakeSwap site if it contributes to PancakeSwap providing a better all-in-one, multichain DeFi platform

Full proposal

Introduction

In 2023, PancakeSwap aggressively expanded multichain, expanding our presence to 9 blockchains and becoming a top-3 DEX by trading volume on many chains while working with various alt-L1 and L2 chain ecosystem teams.

While the expansion of PancakeSwap greatly enhanced the protocol’s presence in an increasingly multichain world, the Kitchen came across various challenges. The main challenges that we noticed are

  1. The exponential growth of new and early alt-L1s, L2s and L3s, at a faster pace than the Kitchen can deploy, with sometimes different technological bases (i.e. non-EVM compatible)
  2. Increasing demands to provide top-tier development, marketing, business development and ecosystem development efforts for every chain PancakeSwap is deployed on, and for every blockchain that requested for PancakeSwap’s deployment

Expansion challenges: Exponential growth of new L1, L2 and L3 blockchains

In 2023, there was a significant increase in number of blockchains, both general-purpose (such as BNB Chain) and also purpose-specific blockchains that have been deployed to various levels of success, gathering different groups of userbases.

DefiLlama alone tracks over 200 existing blockchains, however there are many more in testnet that have yet to be tracked.

PancakeSwap has successfully deployed on 9 blockchains in 2023 and maintained relatively strong trading volumes on each chain. However, with the growth of new L1, L2 and L3 blockchains, it is not scalable for the Kitchen to deploy PancakeSwap to every single chain and remain a top DEX in every chain, even though the crypto industry is becoming increasingly multichain.

Increasing demands to provide top-tier development, marketing, business development and ecosystem development efforts

In each of 9 blockchains PancakeSwap is deployed on, the Kitchen has to spend significant effort to work closely with the blockchain team, as well as projects in those ecosystems, to ensure that PancakeSwap is always providing timely support and is the first DEX of choice for any project builders on those blockchains.

We see that the Kitchen will only be able to scale via more deployments to new chains if we make trade-offs on the quality and frequency of our engagement with existing blockchains and projects.

Additionally, more blockchain deployments will lead to a diversion of tech resources away from upgrading the core DeFi infrastructure that PancakeSwap is working on, putting the future growth of the protocol at risk.

Solution: PancakeSwap Affiliates

To assist the PancakeSwap protocol in being up-to-date with the crypto industry’s developments, the Kitchen intends to invite and, on a case-by-case basis, approve forks of PancakeSwap onto any chains that PancakeSwap is not already deployed on, based on certain principles.

  • Alignment with PancakeSwap’s core platform (all-in-one DeFi platform) and general tokenomics model
  • Orientation towards providing deep liquidity and top-class execution for tokens natively on those blockchains
  • Value accrual to PancakeSwap and CAKE token holders

In return, projects that adhere to such principles will receive PancakeSwap’s official recognition as an affiliate and ongoing support as the Kitchen continuously improves on PancakeSwap’s DeFi offerings.

The structure of what each DEX provides and receives are outlined in the “~tldr” summary at the beginning of this post, and specific terms will be subject to individual negotiations.

The Kitchen recognizes that not all recognized affiliates will be successful on each of these blockchains. In the situation where the DEX is not a top-tier DEX on its native blockchain (defined as top quartile by trading volume), PancakeSwap retains the option to deploy the protocol natively after 6 months.

Desired outcome

Through this proposal, the Kitchen wishes to scale the growth of the PancakeSwap protocol exponentially to new blockchains faster, supporting strong DeFi teams that can rely on the unique and improving PancakeSwap all-in-one DeFi product suite.

In 2024, the Kitchen aims to partner with at least 3 DEXs on 3 chains, each of which are in the top ¼ by trading volume on their respective chains long-term.

14 Likes
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Let’s do it. Cake will fly!

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Really interesting aproach, bravo cake team proud of you.

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Very impressive Head Chef!!

By this PancakeSwap can provide service for more users on more chains with a faster speed and localize.
Include provide games and products on more chains, getting more games from more devs on more chains.

While having some messages came with “I want to fork you but run into XXX issue, please help me” on Git, its a very good idea to provide technical assistance and charge fees.

How is PancakeSwap going to deal when Affiliate DEX want to change code, or probably upgrade SC without notifying Kitchen?

3 Likes
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I strongly agree with this type of proposal and with this one in particular… However, with only 6 months of exclusivity, I think there is little incentive to commit projects or developers to Pancakeswap. I think there should be more incentives or conditions of exclusivity or also the possibility of increasing the time… Perhaps a year could be the answer, in any case serious and stable projects remain over time and a good project can take more than a year to take off or deploy correctly, so 6 months in my opinion is insufficient and could imply disadvantages for Pancakeswap.

With all my heart I hope Pancakeswap becomes number one in many ways and remains stable there.

Blessings and greetings From Chile.

3 Likes
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Hi, thanks for the question.

For the core AMM/DEX, the contracts are not upgradable. V2, V3 have always been this way, which creates assurance to users that the LP functions cannot be upgraded and LP funds cannot be exploited via upgrades. We intend for future upgrades to follow the same principle.

I don’t think that affiliate DEXs necessarily need to use PCS’s DeFi codebase entirely. As the proposal above acknowledges, some of our products rely on external partners. Therefore, for these products, we think that affiliate partners should use other contracts, some of which may be upgradable. We will keep a close eye on these, but generally we will try to partner with teams that we’re comfortable with.

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Hi, thanks for the feedback. I think we wouldn’t mind giving longer deployment periods for teams where appropriate. This will likely depend on the chain in question, as well as the team that is trying to fork us.

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Amazing. Lets go Cake. I think will give Cake more valeur. Lets go to ATH again. Cake deserves to be on top 10 marketcap at least.

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Hi, When can we expect this proposal to go live And how long after the proposal will we see the partnerships go live? and will CAKE holders benefit from the current bull market?

Thank you.

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When are we going to be able to vote on this proposal?

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Will this proposal be in action soon? Btc is nearing new highs and cake is barely moving, This would be a perfect time to showcase new additions and onboard tons of new users.

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Thank you for presenting this comprehensive proposal, which strategically addresses the challenges and opportunities posed by the rapidly expanding multichain ecosystem. The outlined structure for recognizing and supporting 3rd party DeFi teams to deploy PancakeSwap’s core contracts on new chains appears well-balanced, offering benefits for both XXX DEX and PancakeSwap while ensuring alignment with PancakeSwap’s values and goals. The proposed revenue-sharing model, exclusivity period, and ongoing support demonstrate a commitment to fostering long-term partnerships and accelerating the growth of the PancakeSwap protocol across multiple chains. I commend the thoughtful approach outlined in this proposal and look forward to witnessing its implementation and potential partnerships with successful DEXs on new chains in the near future.

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When is this proposal coming?

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Will pancakeswap make any sort of move during this bull market

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19

Is this proposal finally going to be released CAKE needs action the market is flying but cake is being left behind

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Great proposal, register for just say it))

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When could it be within the governance ecosystem to be able to vote? I am quite eager to know when this fantastic proposal can be launched and see the benefits of it for Pancakeswap as well. Greetings and blessings.

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Yes. Lets start the vote. This is Amazing. Open the vote in Pancakeswap to the community team. Lets go all together :sunglasses:

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23

Is this proposal still a thing, Can we get a timeline on when this proposal goes live?

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24

Hi all,

Yes a governance proposal will go live. We intend to do it when an actual partner has been identified and is ready to commit so that tokenholders can vote yes/no to the incoming affiliate.

2 Likes