On October 14, PancakeSwap’s core team — known as the Kitchen — published a governance proposal called “The Flip: Liquidity Should Get Paid More.” If it passes, liquidity providers on PancakeSwap v3 and Infinity would keep 88% of swap fees instead of the roughly 66–68% they earn today, while CAKE emissions would fall by about 69%, from 22,500 to 7,000 tokens per day. The plan, set out on PancakeSwap’s governance forum, is an attempt to fund liquidity through real trading volume rather than newly minted CAKE.
The change would apply to every v3 fee tier and Infinity pool across all 11 chains PancakeSwap supports — BNB Chain, Ethereum, Arbitrum, Base, Solana, Robinhood, Monad, Arc, zkSync, Linea and opBNB — with the remaining 12% of fees going to the Treasury. The older v2 pools, whose fees are hard-coded and which still send 23% of swap fees to CAKE burns, would stay unchanged.
How the 88/12 Split Changes What LPs and Traders Get
Based on 2025 volume, the Kitchen estimates LPs would have earned about $62 million more in fees under the new split — roughly $880 of every $1,000 in pool fees, up from the $660–$680 they keep today. Traders would pay the same fee tiers, but the proposal argues deeper liquidity works in their favor: the Kitchen projects up to about 30% more liquidity in the same pools, 20–25% less price impact per trade, and less room for sandwich attacks and other MEV.
There is a caveat on existing Infinity pools. Because their LP fees are fixed at creation, a lower protocol fee would cut the total swap fee instead — a 1% pool, for example, would become roughly 0.76%, with about 0.67% going to LPs and 0.091% to the protocol.
The 69% CAKE Cut: Deflation Funded by Fees, Not New Supply
The second half of the proposal is a sharp reduction in token emissions. Post-veCAKE emissions would drop from 22,500 to 7,000 CAKE per day — about 15,500 fewer CAKE minted daily, or roughly 5.7 million fewer per year. The remaining 7,000 daily CAKE would go to a new discretionary ecosystem fund the Kitchen calls “the Pantry,” rather than being burned.
CAKE is already ahead of its Tokenomics 3.0 schedule: supply is down 11.5% since that April 2025 proposal, and the Kitchen says v2 burns alone keep the token net-deflationary at roughly 190,000 CAKE per week — about 9.9 million, or ~3%, per year. That pace would clear the remaining ~31.6 million CAKE needed to hit the 2030 supply-reduction target around the end of 2029.
What Still Has to Happen: The Vote and the Risks
“The Flip” is still a discussion, not a decision. It must pass a Snapshot vote, and if approved the Kitchen plans to begin implementation in November 2026 and finish by the end of January 2027. The projections are estimates: the $62 million LP figure assumes 2025 trading volume repeats, and the liquidity and price-impact improvements depend on LPs actually adding the capital the higher fee share is meant to attract.
The trade-off is also structural. Giving LPs 88% leaves the Treasury with 12%, and the 7,000 daily CAKE the proposal keeps minting flows to a discretionary fund rather than to holders or a burn. For the multi-chain DEX and its token, the question the vote will settle is whether trading fees alone can sustain the liquidity that record trading volume has historically depended on incentives to maintain.
