The competition in the Cake ecosystem intensifies, and BNB Chain may give rise to a new giant in Decentralized Finance.

As competition within the Cake ecosystem intensifies, a DeFi protocol with a scale of up to 1 billion USD may soon emerge on the BNB Chain. Several projects are already competing and have launched activities such as deposit coin airdrops to attract users. Some projects' IDO tokens have even achieved a tenfold increase. This article will provide an in-depth analysis of this competition, including ways to participate and potential returns.

1. Competitive Overview

Cake recently updated its token economic model, adopting a veTokenomics mechanism similar to Curve, which supports locking Cake to obtain veCake to enhance LP yields and participate in governance voting. This creates opportunities to build projects similar to Convex, and multiple projects are beginning to compete for veCake shares.

One of the major advantages of Cake is that its V3 version supports concentrated liquidity pools (CLAMM) and can adjust incentives based on liquidity distribution. This allows users to freely deploy positions, avoiding the impermanent loss issues that may arise from traditional custody models. In addition, Cake is also compatible with the trading modes of Uniswap V2 and Curve V1, catering to various liquidity needs.

2. Main Participants

The main participants currently are:

1. Cakepie launched by Magpie
2. Equilibria incubated Skillet Finance
3. Stake DAO

Cakepie and Skillet have launched a deposit-to-earn airdrop event and are offering additional IDO allocations. Magpie, leveraging its previous successful experience, has raised over $6 million in Cake for Cakepie.

3. Revenue Analysis

For example, in similar previous projects, early participants might have gained returns of around 160% or even higher through coin deposit activities. However, there is also the risk of token depegging, which could lead to partial loss of principal.

The main factors for evaluating the returns of such projects include:

1. Participant TVL scale
2. Airdrop Share
3. IDO allocation shares and FDV
4. Expected Total FDV
5. Exit Loss/Depeg Risk

Due to the large scale and revenue of Cake, it is expected that the returns of related projects will also increase correspondingly. However, there are still many uncertainties at present, making it difficult to provide an accurate expectation.

4. Risk Warning

1. The risk of token depegging may lead to principal loss.
2. The capability of the project party has a significant impact on returns.
3. The competition is intense, and the final outcome is uncertain.

5. Summary

1. This competition may give rise to a DeFi giant on BNB Chain with a TVL of 1 billion USD and an FDV of 100 million USD.

2. Early participants are expected to gain considerable returns, but must be wary of depeg risks.

3. Due to the many uncertainties, it is difficult to provide a clear expectation. It is recommended to participate cautiously and closely monitor the project's progress.