I’m a former Cake bull.I wrote a post 7 months ago where I outlined why I loved Cake and thought it was going to keep rising.

Post: https://www.reddit.com/r/pancakeswap/comments/nbgzrm/why_i_bought_more_cake_and_im_still_bullish/

2 months ago, I sold my Cake at around ~$21. (Bought in at $10 and staked for half a year)

Look, I'm not here to spread FUD. I'm not bitter.

I fucking LOVED CAKE and will always be grateful that it introduced me to DeFi.I’ve noticed that a lot of people don’t understand the fundamentals of WHY Cake keeps going down.So my goal is to provide my perspective and help some of you become better investors. I will not be shilling any projects.

Why Cake had a Meteoric Rise:

Cake started at $.61 on January 1st and hit an all-time high in April at $42.59. Fucking insane.

A few things contributed to this:Shitcoins such as Safemoon were skyrocketing. And Binance Smart Chain became a go-to platform for them.

Cake also become the #1 DEX in the world by users. Cake was the alternative for retail investors get into DeFi without the ridiculous ETH fees.And PCS had an interesting roadmap.

They were going to be an all in one solution for BCS with games, NFT’s, lending, etc.

The future looked bright for PancakeSwap.

Why Cake’s Price Has Tanked since April.

/1 Binance Smart Chain is no longer hot. BSC came at a perfect time. People wanted an alternative to the ridiculous ETH gas fees. Finally people could use BSC and Cake to use DeFi.But since earlier this year, we’ve seen the rise of different L1 solutions. AVAX, Harmony One, Solana, and FTM have exploded in usage and popularity. Matic and Layer 2 solutions are keeping ETH in the game for retail investors.

People don’t like BSC. It has developed a reputation for rug pull central. BSC no longer has a competitive advantage anymore.

/2 Cake is Inflationary and Doesn’t have Any Utility.

This is the biggest issue.

PancakeSwap prints Cake. Yes there are “burns” each week, but it’s still inflationary.They can’t just stop printing cake. Printing cake is what gives those APY’s. No APY’s means no more stakers.

Because the price of CAKE has been dropping, staking Cake is a risky proposition. You can get 73% APY, but how much is that worth if Cake’s price keeps dropping?

So how do we curb inflation?

You either increase the amount of users to Cake, or you create more use cases for Cake.

Increasing the amount of users is hard.

They’re already the most used DEX in the world. And now you have all the other chains siphoning users.PCS has tried creating more use cases.

Lottery and predictions are decent, but it’s not enough to stop the inflation monster.I honestly believed they had a shot with the NFT marketplace. OpenSeas could use a solid competitor and PCS had the distribution and audience to be a worthy alternative.

But there are several problems:

They’re not executing fast enough.I’ve realized that the PCS team aren’t the best at execution. How many times have predictions and lottery gone down? How long has it taken them to roll out the NFT marketplace?

The PanCakeSquad NFT collection pissed off a lot of users when bots sniped everything.

The nail in the coffin is when the NFT marketplace uses BNB instead of Cake. Paying for NFT’s with Cake would’ve given Cake actual value and utility.

I have seen some people argue that it should be in BNB. Just like how OpenSeas prices everything in ETH. And all the BNB fees are used to buyback Cake.

I disagree. Keep it simple. If you want utility for Cake, then have NFT’s be priced in Cake.

That’s when I realized…PanCakeSwap exists to serve CZ and the Binance Smart Chain.

If PCS was an independent entity, then going multichain would’ve been a no brainer months ago. But they can’t do that because they exists to serve the Binance Smart Chain.

/3 The Rise of OHM Forks.

This is something that people have underestimated.People liked staking with Cake because it gave some amazing APY’s. First, the APY have come down drastically. When I first entered, it was around 300% APY which was mind blowing.

Now autocake is around 73%.Here’s the problem with 73% APY – it looks like nothing compared to 73,000% APY.

And 73% APY doesn’t look appealing when the Cake price is gone from $20 to $11 in the past two months. It’s risky.

I’m not here to debate if these ponzis are a good investment or not. But we can’t argue that they are gaining in popularity and grabbing users away from PanCakeSwap.

In defense of PCS, ALL DeFi 1.0 projects are tanking. Look at UniSwap, SushiSwap, MakerDao, etc. People are pouring their money into newer, and more innovative projects.

I don’t see a way for Cake’s value to increase at this point. They HAVE to keep printing more cake, but the token itself doesn’t have value.

I hate that I have to write this post.

One piece of investment advice: don't be married to your bags. If you want to keep investing in Cake, then great.

But make sure you're able to articulate why it's still a good investment, and you're not holding on to it because of emotions.

Zero-based decision-making means if you had to start your portfolio from scratch today, would you still buy Cake?Even though I’m no longer invested in Cake, I hope they prove me wrong. I’m cheering for you guys.