PancakeSwap remains a dominant decentralized exchange (DEX) on BNB Chain in 2025. Despite the launch of PancakeSwap V3 with advanced features, PancakeSwap V2 is still widely used. Many projects and traders stick with V2 because of its simplicity and the “set-and-forget” nature of its liquidity pools. In PancakeSwap V2, liquidity is automatically distributed across the entire price range, making it easy to create and manage pools without complex configurations. By contrast, V3 introduced concentrated liquidity and other improvements that, while powerful, add complexity for average users. This article will explore why PancakeSwap V2 remains popular (with some recent stats on usage), why locking liquidity is a crucial security measure (and why many projects continue to lock V2 liquidity), and provide a step-by-step guide on how to lock liquidity using Mudra Locker – a popular PancakeSwap liquidity locker on BSC.
PancakeSwap V2 vs V3: Why V2 Remains Popular in 2025
PancakeSwap V3, launched in 2023, offers features like concentrated liquidity (letting liquidity providers focus funds in specific price ranges) and flexible trading fees for different slippage tolerances. These features can boost capital efficiency and reduce trading fees by up to 25x compared to V2. However, the added flexibility comes at the cost of complexity – liquidity providers must actively manage positions and understand price ranges. Even the PancakeSwap team acknowledged that “v3 is a little more challenging to understand” for users, even though it improves volumes and efficiency. In V3, providing liquidity effectively means minting an NFT representing your position and potentially adjusting it over time.
By contrast, PancakeSwap V2 is straightforward. Liquidity providers deposit two tokens into a V2 pool, and the automated market maker (AMM) handles the rest – liquidity is spread across all prices automatically. There’s no need to monitor or adjust price ranges. This simplicity and reliability have kept V2 attractive, especially for new projects and community-driven tokens that prefer a “fire-and-forget” approach to liquidity. V2 pools automatically generate LP tokens (representing your share of the pool) when you add liquidity, and anyone can create a new pair with ease. The V2 interface and process are familiar to millions of users, making onboarding simpler.
Another reason PancakeSwap V2 remains popular is the ecosystem support and inertia. Many existing tokens have their main liquidity on V2 and have not migrated to V3. The PancakeSwap team has also made it clear that V2 will continue to operate and be supported alongside V3. Projects that launched with V2 are not forced to switch – in fact, PancakeSwap noted that there’s “no need to change contracts. V2 will continue to operate as usual, and we will continue to support projects who wish to use V2.”. While they encourage trying V3 (which even has a “full range” option to mimic a V2-style position), the ongoing support for V2 reassures projects and users that V2 isn’t going anywhere.
V2’s popularity is reflected in the numbers. Even after V3’s release, PancakeSwap V2 still holds a huge portion of the platform’s liquidity. For example, towards the end of 2024, PancakeSwap V2 on BNB Chain had roughly $1.2 billion Total Value Locked (TVL), significantly more than PancakeSwap V3’s ~$0.4 billion. In other words, V2 was (and continues to be) hosting at least three fourth of PancakeSwap’s liquidity, underscoring how many users still rely on it. This trend highlights that PancakeSwap V2’s simplicity and established pools keep it widely used, even as newer versions roll out.
Why Liquidity Locking Is Crucial (and Why Many Projects Lock V2 Liquidity)
Whether a project uses PancakeSwap V2 or V3, locking liquidity remains a fundamental security practice in 2025. Liquidity locking means taking the LP tokens that represent a project’s liquidity (e.g. the tokens you get after adding your token and BNB to a PancakeSwap pool) and locking them up in a third-party smart contract (a liquidity locker) for a set period. By doing so, the project’s team cannot suddenly withdraw the liquidity from the DEX – this is critical for building trust with investors.
Why is this so important? Here are a few key reasons:
- Prevents Rugpulls: In the past, malicious developers could add liquidity to a DEX, attract buyers, then pull the liquidity (remove it), crashing the token’s price – a classic scam known as a rugpull. Locking liquidity makes this impossible during the lock period, protecting investors from exit scams.
- Builds Credibility: A new project with locked liquidity signals that the team is in it for the long run. It shows commitment not to touch the liquidity, which builds investor confidence. Many crypto communities simply won’t trust a project if the liquidity isn’t locked because it implies the team could run off with the funds.
- Investor & Listing Expectations: By 2025, it’s often expected that legitimate projects lock their liquidity for a substantial duration. Investors look for proof of a liquidity lock before buying in, and even listing platforms (like certain exchanges, CoinMarketCap, etc.) may require evidence of liquidity lock as part of due diligence. In short, locked liquidity is a standard indicator of a serious project.
Given those benefits, most serious projects launching on PancakeSwap will lock their LP tokens on day one. Notably, many projects still prefer to lock liquidity from PancakeSwap V2 pools. The main reason is that, as discussed, a lot of tokens launch on V2 due to its simplicity and user base. The LP tokens from V2 are BEP-20 tokens that are easy to lock using popular locker services. In contrast, PancakeSwap V3 uses NFT-based liquidity positions; while there are solutions to lock or time-lock NFTs, they are less common and can be more complex to verify for average users. For practicality and transparency, teams often stick with V2 liquidity and lock those LP tokens so that anyone can see the lock.
Another consideration is compatibility with liquidity locker platforms. Numerous liquidity lockers support BSC (PancakeSwap) LP tokens, especially V2 LP tokens, out-of-the-box. For example, Mudra Liquidity Locker (part of Mudra Manager) is a trusted service dedicated to BSC projects, and it’s known as one of the most secure and user-friendly liquidity locker platforms with low fees. There are others like Unilocker, Team.Finance, Unicrypt, PinkLock, and DxLock, but Mudra has become a go-to for many BSC teams due to its ease of use and affordability. The availability of such tools makes locking V2 liquidity straightforward – another reason projects feel comfortable using PancakeSwap V2 and locking those LPs for security.
In summary, locking liquidity is crucial to protect your community and project reputation. It ensures your PancakeSwap liquidity (especially on V2, where most projects still reside) cannot be removed on a whim, mitigating rugpull risks. Now, let’s walk through how you can lock your PancakeSwap liquidity using one of these lockers – Mudra Locker – step by step.
Step-by-Step Guide: How to Lock PancakeSwap Liquidity with Mudra Locker
Locking liquidity might sound technical, but it’s actually a straightforward process. Below is a detailed guide using Mudra Locker as an example. Mudra Locker is a popular liquidity locker for PancakeSwap (V2) on BNB Chain, often considered a “PancakeSwap liquidity locker” due to its focus on BSC. The steps will be very similar on other locker platforms too. Before starting, ensure you have already added liquidity on PancakeSwap V2 and have the LP tokens in your wallet.
Step 1: Provide Liquidity on PancakeSwap V2
You must have liquidity pool tokens to lock. If you haven’t done so, go to PancakeSwap V2 and create a liquidity pair for your token (usually paired with BNB, BUSD, or another base token). For example, if your project token is XYZ and you want to add liquidity with BNB, go to PancakeSwap V2 -> Liquidity, add the XYZ-BNB pair and deposit the tokens. Once you supply liquidity, PancakeSwap will mint LP tokens (XYZ-BNB LP tokens) to your wallet, representing your share of that pool. Double-check that these LP tokens now appear in your wallet – you’ll need them for the locking process. (Tip: Only proceed to lock liquidity once you’re sure you won’t need to withdraw it for the duration of the lock, as you won’t be able to access these tokens until the lock expires.)
Step 2: Navigate to Mudra Locker
Open the Mudra Locker platform in your web browser. The official site is usually https://mudra.website – from there, find the Mudra Liquidity Locker section. (Ensure you’re using the correct and official URL to avoid phishing sites.) You should see an option to “Lock Liquidity” or “Lock LP tokens” on Mudra’s dashboard.
Step 3: Connect Your Wallet
Click on the “Connect Wallet” button on Mudra Locker. Use the same wallet that holds your PancakeSwap V2 LP tokens (e.g., MetaMask or Trust Wallet). Make sure your wallet is set to the BNB Smart Chain network (BSC), since Mudra is on BSC and your LP tokens are BEP-20 tokens. Once connected, Mudra’s interface will recognize your wallet address.
Step 4: Select the LP Token to Lock
After connecting, look for the option to add a new liquidity lock. Typically, you will need to select the LP token you want to lock from a dropdown list or by pasting the token contract address. For PancakeSwap V2 LP tokens, you can usually find your pair by name (e.g., “XYZ-BNB LP”). Select the correct LP token. Then enter the amount of LP tokens you wish to lock. Projects often lock 100% of their LP tokens to maximize investor trust, but you can choose a portion if for some reason you need to keep some liquidity unlocked. (Keep in mind, any unlocked portion might raise questions from the community.)
If this is the first time you’re interacting with Mudra Locker for this particular LP token, the platform will prompt you to approve the LP token first. This is a standard step on BSC: you need to approve the locker smart contract to spend (lock) your tokens. Just confirm the approval transaction in your wallet when prompted. After approval, continue with the locking interface.
Step 5: Configure Lock Duration and Details
Now, set the lock duration – i.e., how long the liquidity should remain locked. You will usually specify an unlock date/time. Choose a timestamp or use the date picker provided. In 2025, most projects opt for at least a 6-12 month lock on liquidity to show long-term commitment. Common choices are 1 year or even longer (some locks are multi-year). For example, you might set the lock until a date one year from now. Make sure the duration is reasonable and long enough to assure investors (a few weeks or months is usually too short to build confidence, unless you plan staged locking). Enter the unlock date.
Before finalizing, double-check all details on the summary Mudra provides: verify that the correct LP token is selected, the correct amount is listed, and the unlock date is as intended. It’s worth reviewing because once you lock, you cannot undo it (except by waiting until the unlock date).
Step 6: Lock the Liquidity
Everything looks good? Proceed to execute the lock. Click the “Lock” or “Lock Liquidity” button on Mudra. Your wallet will pop up asking you to confirm the transaction. Confirm it to officially lock the LP tokens. You will need to pay a small gas fee in BNB for this transaction, as it’s an on-chain action. Once you approve, wait for the transaction to be confirmed on the blockchain (a few seconds to a minute, typically). Congratulations – your liquidity is now locked! The LP tokens have been transferred into Mudra’s locking smart contract, which will hold them until the unlock date.
Step 7: Verify the Lock and Get Proof
After the transaction, Mudra’s interface should show a confirmation that your liquidity is locked. You will see details of the lock (which token, how much, and until what date). It’s a good practice to copy the lock URL or certificate provided by Mudra. Mudra Locker usually provides a unique link or a hash that serves as proof of the lock – for example, a page showing “X LP tokens locked until [date]”. Save this proof.
It’s also important to share this proof with your community. Publish the lock link or certificate on your project’s website, Telegram group, Discord, or Twitter. This way, any investor or potential buyer can independently verify that the liquidity is indeed locked and see when it will unlock. Sharing the proof is crucial for transparency. If you plan to list your token on tracking sites or exchanges, they may ask for this info as well. Having a publicly viewable lock record (with a reputable locker like Mudra) immediately boosts confidence in your project.
Step 8: Post-Lock Considerations
Mark the unlock date on your calendar. When that date arrives, you (the token owner) will be able to go back to Mudra and unlock (withdraw) the LP tokens, or extend the lock further. Best practice for long-term projects is to extend (re-lock) the liquidity as the unlock time nears, to continue assuring your community. Many teams will roll their locks or even increase liquidity and re-lock for another year when the time comes. However, if there’s a legitimate need to migrate or use the liquidity (for example, moving to PancakeSwap V3 in the future, or shifting to a new DEX), communicate with your community ahead of time. The key is transparency: if you ever end a liquidity lock, investors should know the reason and how you’ll maintain trust (often by relocking in a new location if you migrated).
By following these steps, you have effectively used a PancakeSwap liquidity locker to secure your project’s liquidity. Mudra Locker (and similar services) make it easy to lock LP tokens with just a few clicks and transactions. The process is user-friendly and well worth the peace of mind it provides to both project developers and token holders.
Conclusion
PancakeSwap V2 continues to thrive in 2025 due to its simplicity and robust community usage, even alongside the feature-rich V3. For new projects launching on PancakeSwap (especially on V2), locking liquidity is a non-negotiable step to ensure trust and safety. A locked liquidity pool means the project developers can’t run away with the funds, which prevents rugpulls and boosts credibility. It’s evident that investors and the broader crypto community expect this measure for virtually all new tokens.
Using a reliable liquidity locker like Mudra Locker on BSC is an effective way to achieve this. Mudra is specifically tailored for PancakeSwap (BSC) liquidity and is known for its secure yet affordable service. By locking your PancakeSwap V2 LP tokens through Mudra, you’ve taken an essential step in legitimizing and securing your project. The step-by-step guide above demonstrates that the process is straightforward: from obtaining LP tokens, to configuring a lock period, to confirming the lock and sharing proof.
In doing so, you not only protect your early supporters but also signal to the world that your project is here to stay. A well-structured PancakeSwap liquidity lock instills confidence, allowing you to focus on building your project without worrying about liquidity fears in the community. In the fast-moving DeFi space, such fundamentals of trust can set you on the right path. Now you can move forward with developing your token and ecosystem, knowing that your PancakeSwap liquidity is safely locked away until the chosen time – a smart move for any serious crypto project in 2025.
Angela Spearman is a journalist at EzineMark who enjoys writing about the latest trending technology and business news.
