The rise of Decentralized Finance (DeFi) has given rise to Decentralized Exchanges (DEXs). What is DeFi? It is a whole ecosystem of cryptocurrencies known as DeFi tokens, and DEXs are exchanges where you can buy such tokens.

To buy tokens on DEXs, all you have to do is connect a wallet. Metamask is one of the wallets used for this purpose, and this guide demonstrates how to use it to buy DeFi tokens on Pancakeswap.

What Is Metamask?A screenshot of metamask wallet home page

Metamask is a browser extension that serves as a cryptocurrency wallet used to interact with the Ethereum blockchain. Unlike a regular wallet, this only supports ERC20 tokens, which are tokens based on the Ethereum blockchain.

It recently started supporting BEP20 tokens too, on Binance Smart Chain (BSC). If you're an absolute beginner, you should find out more about how to get started with Metamask.

You can easily set up a Metamask wallet by creating just a password. You can then add Ethereum blockchain or BSC tokens to it. There are hundreds of tokens supported, so chances are whichever one you're interested in is supported if it is based on these two blockchains.

Something really great about the wallet is that you can add unsupported tokens to it through the "add token" option. Being a web3 wallet, Metamask also supports web3 Decentralized Applications (Dapps) and Non-Fungible Tokens (NFTs).

If you prefer to use your mobile device, you can also access the wallet by installing it from the Play Store or iOS Store.

Metamask is used to store and manage your account keys. Like a regular wallet, it also broadcasts transactions, as well as send and receive ERC20 and BEP20 tokens.

It is easy to swap tokens within the wallet using the Metamask "Swap" feature as well. The wallet aggregates Several DEXs to get the best exchange rates for the swaps. Many people are not familiar with what DEXs are, but they are quite easy to use.

What Is Pancakeswap?

Screenshot of Pancakeswap showing where to connect wallet

Pancakeswap is one of the top decentralized exchanges. This is not to be confused with Pancakeswap (CAKE) the token, which is the native token for the exchange. Pancakeswap is designed specifically for trading DeFi tokens based on BSC.

Apart from trading DeFi tokens, you can also farm liquidity and stake the CAKE token to receive rewards on Pancakeswap. Unlike centralized exchanges, you can just hop on the internet and start using the DEX without any registrations and there are no personal details required.

Why Use Metamask?

Metamask was first launched in 2016 and now has millions of monthly users. This is because the wallet has found relevance, especially in the DeFi ecosystem. See this short guide to decentralized finance to know more about the ecosystem if you are just starting out with it.

If you wish to easily buy or trade DeFi tokens then using something like Metamask is inevitable. Also, as the world is moving towards Web3, the wallet is also becoming increasingly relevant as only wallets like Metamask can interact with decentralized exchanges, dapps, and NFTs.

How to Buy Crypto With Metamask

Because Pancakeswap is a DEX designed for trading BSC-based tokens, this guide focuses only on tokens supported by BSC. There are tokens that are available both on BSC and Ethereum.

You can also trade the BSC version of such tokens on Pancakeswap. So, how do you buy a token on Pancakeswap using Metamask?

1. Create a Wallet

Screenshot of metamask download page

The first thing to do is to create a Metamask wallet. If you already have one, then congratulations, you can move on to the next step. If not, it is as easy as going to metamask.io and clicking on the blue Download button. Supported browsers include:

  • Chrome
  • Firefox
  • Brave
  • Edge

You'll then be asked to create a strong password, which should be something you can easily remember but hard for other people to guess. After creating a password, you'll be prompted to copy and keep your passphrase safe, you should do as suggested.

The passphrase is usually a 12-word phrase you can use to recover your wallet should anything happen to your device, or you forget your password.

You should write them down, and you'll be asked to enter them in the correct order to show you really wrote them down. Countless people have lost a fortune because they ignored this step.

2. Add Funds to Metamask

Once your wallet is set up, you'll need to fund it with BNB, which is the native token for BSC. One way to do this is to buy by clicking on the Buy button in the picture below.

Screenshot of metamask wallet showing BNB balance

The other way is by sending the asset from another wallet or exchange to Metamask by simply copying the address at the top and sending the BNB to it. The default blockchain for the wallet is Ethereum, so you have to change it to BSC by clicking on the down arrow next to Ethereum as shown in the picture below.

Screenshot of metamask wallet showing change of blockchain to BSC

Select Binance Smart Chain from the dropdown, and you are good to go.

3. Connect Metamask to Pancakeswap

To connect your Metamask Wallet to Pancakeswap, visit the website pancakeswap.finance. There, you will see the Connect Wallet button on the top right-hand corner as shown below.

Screenshot of Pancakeswap showing where to connect wallet

Click on the button and select Metamask from the list of wallets, and you will be connected. You should see a wallet icon where the connect button used to be, with the first two and last six characters in the wallet address.

4. Buy Crypto on Metamask

Finally, go to Trade as is in the picture above. Click on it and select Swap from the dropdown. You should have the screen below.

Assuming you wish to buy CAKE, the native token for Pancakeswap as shown, all you have to do is enter the amount of BNB you wish to trade for CAKE. Click MAX if you wish to use all your BNB, but this is not advisable as you need some BNB left to pay for fees in the future.

Screenshot of pancakeswap showing swap window

Slippage, the extent of variation from the expected rate, is set at 0.5% by default. You may need to increase this depending on the token of interest and how congested the network is at the time you wish to trade.

If everything goes well, you'll see a highlighted SWAP button below. Click on it and your trade is done. Congratulations, you have successfully bought your first crypto on Pancakeswap using Metamask.

Is Metamask Safe?

Metamask was designed with security as an inherent feature since it is noncustodial. This means no user data is stored on it, so there is no chance that hackers will steal any of your data from it.

It is however a hot wallet and hot wallets are the most vulnerable of all. For someone interested in interacting with Ethereum though, Metamask is a risk worth taking.

Pros and Cons of Metamask

What should you consider before moving forward with Metamask?

Pros:

  • Does not store user data
  • No KYC required to use
  • Wallet is Open-Source, which makes it quite safe to use

Cons:

  • Hot wallets are vulnerable
  • Only supports Ethereum and BSC-based tokens.

Is Metamask Worth Using?

Having gone through this article and seeing how to buy crypto using Metamask, is Metamask worth using? If you wish to interact with DeFi tokens on Ethereum and BSC, yes.

DeFi tokens, Dapps, smart contracts and NFTs are becoming the order of the day and Metamask is one of the major gateways to the ecosystem, so yes it is worth using.