Before going through this guide, please make sure you have a Binance Smart Chain enabled wallet. Click here to view our guide on how to add the Binance Smart Chain to MetaMask.
What is PancakeSwap?
It’s an Automated Market Maker (AMM) which is a type of decentralised exchange (DEX). AMM’s rely on mathematical formulae to price assets. A traditional exchange would use an order book but AMM’s use algorithms to automate the pricing of their assets.
Because it’s a decentralised exchange, you don’t have to sign up and go through a KYC (Know Your Customer) verification process, like when you sign up to a centralised exchange (such as Binance or Coinbase). Another benefit of decentralisation is there are no restrictions based on your location.
PancakeSwap is on the Binance Smart Chain (BSC) network. This means you can only exchange tokens on the BSC network. If you wanted to buy or sell tokens on the Ethereum network, you would have to use a different DEX. We recommend using Uniswap or 1inch for the Ethereum network.
If your centralised exchange supports the token you want to purchase, you can buy it on there as well.
It's important to note that a token can be on more than one network. This is called ‘Bridging’. Some projects that started on the Ethereum network bridged over some or all of their tokens to the Binance Smart Chain because the Ethereum transaction fees were too high.
Decentralised exchanges have many benefits. One of the main benefits being that smaller projects can list their coin on a DEX very easily. In most circumstances, there’s a cost to getting listed on a centralised exchange, and those costs rise with the quality of the exchange. Most new startups cannot afford to be listed on these exchanges.
This is great news for us because we can use PancakeSwap to buy these new and upcoming tokens with small transaction fees!
First things first, we need to connect our wallet to PancakeSwap. This is so it knows our crypto balances which will then enable us to buy and sell. To connect your wallet, follow the below steps:
Now we’re going to the exchange to swap some tokens:
The default choice for the top token will always be BNB. To change this, just select it and then search for the token you want to swap:
However, before we make the swap, we recommend that you check your slippage tolerance and set it to an amount you’re happy with. We tend to keep it around 0.5-1% for normal swaps. If you set the amount to 0.1% and you get errors with the trade not completing try increasing your slippage:
Now that we have selected what we are swapping - From (BUSD) and To (CAKE) - we now need to select the amount. There are a few ways we can do this:
A = You can click your total balance if you want to swap all of the From (BUSD) token amount.
B = You can type in the amount of the From (BUSD) token amount if you want to spend a specific amount.
C = You can type in the amount of the To (CAKE) you want to receive. In this example we have selected 1 CAKE which is $38.341.
Once you’ve decided how much you’re going to spend and you’re happy with the figures, select Swap, check all the details are correct, and proceed with the transaction (note that you might need to approve the token first before you can swap):
You should get a notification in less than a minute (could be longer if the network is congested) that the transaction has been confirmed. You can also use the clock to view the transaction on BSCscan:
You will find more details on the transaction here which is useful for tracking your trades. Please note, when tracking your trades the BNB price listed is the current price of BNB, not the price of BNB when you did the trade:
How to add a missing token to PancakeSwap
There may be times that the token you would like to receive isn’t in the list when you search for it.
To add a token, all you need is the contract address for that token. You just need to ensure that the contract address is correct. Scammers create fake coins to try and trick you into stealing your money, so make sure you do your research (check this guide on tips on avoiding scams). Ensure you get contract addresses from trusted sources like the projects website or official social media.
For this example, we’re going to BSCscan to find our tokens contract address:
Go back to PancakeSwap and select ‘To’ and paste in the token's contract address:
Now you can swap for the token you’ve just added. Follow this method for adding any tokens that aren’t in PancakeSwap's list.
How to sell your tokens
Select the token you would like to receive. You could also click the arrow and it will switch your ‘From’ and ‘To’ selections. If you’re happy with the results swap and approve the transaction:
These are the basics of swapping in PancakeSwap.
PancakeSwap Errors and how to Troubleshoot them
If you use PancakeSwap regularly, you will inevitably get an error. Here are some of the common errors and how to resolve them.
Price is moving quickly and your slippage tolerance is too low for the transaction to process.
You can either try refreshing the page and trying again, or increase your slippage tolerance and try again. Scroll up to see how to set your slippage.
If you’re still getting this error after increasing your slippage and refreshing the page, try this solution. Sometimes when using either very large numbers or numbers with a lot of decimal places it can cause your transaction to fail.
A = To solve this, try removing the numbers after the decimal place so you have 4 after the decimal place.
B = Change the amount to a round number. By making the number a bit simpler it should help the PancakeSwap algorithm process the transaction.
(Note if you’re trying to buy a token close to it’s release you should set your slippage to 15% as price will be moving very quickly)
You can find more troubleshooting help in this official PancakeSwap document.
Check back to this guide as it will be updated with more advanced techniques, tips and tricks!