PancakeSwap wants to give liquidity providers a much bigger slice of the pie. A new discussion-stage proposal would send 88% of trading fees from its v3 and Infinity pools directly to the people supplying the liquidity.
The rest would flow to the protocol treasury. Meanwhile, the CAKE emissions picture is getting leaner too, with the plan framed around a roughly 69% total cut to emissions.
What the proposal actually changes
PancakeSwap’s newer pool designs, v3 and Infinity, use concentrated liquidity. That means LPs can park their capital in specific price ranges instead of spreading it thin across every possible price.
Under the plan, 88% of the fees those pools generate would go to LPs. The remaining share would be directed to the treasury rather than elsewhere in the system.
The older v2 pools are left alone. Their existing fee structure, which includes a mechanism that buys back CAKE and burns it, stays intact.
The emissions side ties back to earlier changes. Tokenomics 3.0, introduced in April 2025, reduced daily CAKE emissions by roughly 44%, from about 40,000 tokens to around 22,500. Factoring in the latest proposal, the cumulative reduction comes to roughly 69%.
It is worth stressing that this is still at the discussion stage. Nothing has been voted through yet.
The deflation scoreboard so far
As of October 2026, the protocol reports a net CAKE supply reduction of roughly 15-16%. Supply has fallen from about 392 million tokens in September 2023 to around 330 million.
The protocol has recorded 37 consecutive months of net burns since September 2023, meaning more CAKE has been destroyed than created every single month in that stretch.
Weekly data from mid-October 2026 points the same direction, with approximately 529,000 CAKE burned in a recent period against lower emissions.
The broader framework behind all this goes by the name “The Kitchen.” Tokenomics 3.0 set a target of around 4% yearly deflation, funded by buybacks drawn from protocol revenue.
On the product side, Infinity has become a serious volume engine. Its pools have logged cumulative trading volume of more than $150 billion.
On some chains, Infinity already hands LPs up to 90% of fees. Robinhood Chain is one example. So the 88% figure for v3 and Infinity is less a radical leap and more a move toward standardizing a generous split across the board.
Background: from farm token to fee machine
PancakeSwap is one of the largest decentralized exchanges operating mainly on BNB Chain. For years, the main lever protocols pulled to attract LPs was token emissions. PancakeSwap’s recent tokenomics overhauls have been an attempt to replace that subsidy with real trading fees.
What this means for LPs, CAKE holders and the treasury
For CAKE holders, cutting emissions reduces new supply hitting the market, which supports the deflationary narrative. Keeping the v2 burn intact preserves at least one direct link between trading activity and token destruction.
Sending the non-LP share of v3 and Infinity fees to the treasury, rather than into buybacks, is a choice worth watching. A treasury can fund development, partnerships, or future burns, but holders will want clarity on how those funds get used.
Lower emissions mean fewer token rewards for LPs, so the higher fee share partly compensates for that lost income. Whether the trade is a net gain for LPs depends heavily on how much volume the pools keep generating.
The key things to watch are the governance discussion itself, any changes to the 88% figure as the community weighs in, and whether a formal vote follows. After that, the real test is whether LP deposits and trading volume in v3 and Infinity pools respond to the new split.
The 37-month net burn streak is the other number to keep an eye on. With v2 still handling the burn, a meaningful shift of volume toward v3 and Infinity could change how quickly CAKE supply shrinks from here.
Disclosure: This article was edited by Estefano Gomez. For more information on how we create and review content, see our Editorial Policy.