Dogecoin was the hottest altcoin a few weeks ago, thanks to Elon Musk and Mark Cuban’s enthusiastic comments. Dogecoin, on the other hand, has taken a step back after its meteoric rise. Meanwhile, traders have turned their attention to SafeMoon, the most recent hot token.
April has been a whirlwind for SafeMoon. It soared as high as 2,000 percent at one point, reaching $0.0000130. However, since its peak, it has dropped by roughly two-thirds to around $0.000006. With such high price volatility, it’s no surprise that traders are scrambling to figure out how to buy SafeMoon and profit from the fluctuations.
Because SafeMoon has only been around for a month, it isn’t yet listed on many major crypto exchanges like Coinbase (ticker: COIN). In fact, SafeMoon trading has so far been limited to two primary sources. Here’s what you should know if you’re thinking about investing in cryptocurrency:
- What is SafeMoon?
- How to buy SafeMoon?
- Should you invest in SafeMoon?
What is SafeMoon?
What distinguishes SafeMoon from the other cryptocurrencies and altcoins on the market?
This alternative asset employs an ingenious strategy to reward long-term investors. Clayton Moore, CEO of NetCents Technology, a cryptocurrency payment processing platform (OTCMKTS: NTTCF), explains: “SafeMoon, unlike most other cryptocurrencies, charges a 10% exit fee to investors who sell them. The fee is split in half and distributed to all SafeMoon owners, with the other half being burned. Long-term investors will benefit from the company’s burn strategy, which it promises will be beneficial and rewarding.”
In theory, this will function similarly to a turbocharged share repurchase programme. If everything goes according to plan, SafeMoon token owners will see their ownership stakes grow over time as the exit fee is redistributed to remaining token holders. Meanwhile, the burn, which works similarly to a stock buyback programme, will gradually reduce the number of existing SafeMoon tokens.
How to buy Safemoon?
PancakeSwap is the most popular way to purchase SafeMoon.
PancakeSwap is an automated market maker that was launched last fall. It’s a decentralised finance (DeFi) application that lets you do everything from trading to liquidity provisioning to yield farming. A video tutorial on how to buy SafeMoon using PancakeSwap was posted to SafeMoon’s official Twitter account.
Users must first purchase Binance tokens. SafeMoon’s backers recommend MetaMask and Trust as two good options for storing these in a wallet that supports the technology. Traders can then use the BSC network to exchange Binance tokens for SafeMoon.
Another good option is the BitMart exchange. It listed SafeMoon on April 5, before it really took off, and as a result, the token has a good amount of liquidity.
Should you invest in SafeMoon?
So now you know how to buy SafeMoon and why it’s attracting so much trader interest – but is SafeMoon a good investment?
The project has received widespread criticism. On social media, prominent crypto thought leaders slammed the currency, comparing it to the infamous Ponzi scheme Bitconnect.
Moore echoes this scepticism. While he sees some advantages to SafeMoon, he remains cautious. “SafeMoon has been compared by some experts to a multi-level marketing scheme that aims to make only a few people wealthy. Furthermore, I believe that the fact that the SafeMoon CEO owns more than 50% of the company is extremely concerning “Moore describes it as “uidity.” While there is a lock-up on these funds, the fact that so much of the coin’s ownership is centralised is concerning.
The people who discover a new token first make a large portion of the profits, which is a common feature in the altcoin scene. “I personally believe that SafeMoon will crash at some point,” Moore says. “By the time the majority of people learn about SafeMoon, it will almost certainly be too late to make any short-term profits.” That brings us to the crux of the problem. While SafeMoon may turn out to be a good project, the token isn’t necessarily a buy at the peak of its hype cycle.
Brandon Mintz is the CEO of Bitcoin Depot, a company that has over 2,000 Bitcoin ATMs around the world. SafeMoon, unlike Bitcoin or Ethereum, Mintz believes, should be approached with caution for the time being “is unlikely to have as much underlying value in the long run. Furthermore, “we’ve already seen a significant drop in its value.” There is too much concern over the safety of the coin,” Mintz says.
However, Mintz isn’t entirely negative about SafeMoon. “Investors appear to be flocking to new DeFi protocols like SafeMoon,” Mintz adds, “so usage can definitely provide more underlying value as time goes on.”
That, at the end of the day, will be the deciding factor. If SafeMoon is to be successful, it must expand its capabilities beyond that of a speculative tool. The loyalty feature is a plus, but it may not be enough to justify SafeMoon’s current price. “Investors should be wary of a cryptocurrency with no real utility, in my opinion. It’s clear that the SafeMoon team wants to reward loyal customers, but what’s the point of hoarding the cryptocurrency if it has no real value?” Moore explains.
SafeMoon’s whitepaper appears to dismiss this criticism, with goals of establishing a marketplace for non-fungible tokens (NFTs), orchestrating charitable projects, and developing educational crypto apps.
Still, until you walk the walk, it’s all talk, so keep that in mind before investing.
