"What is SafeMoon?" is one of the most searched questions on Google as the new lunar-inspired cryptocurrency craze takes over social media. SafeMoon is a DeFi token. DeFi is a portmonteau of the words "decentralized finance," a cryptocurrency movement that seeks to cut out authoritative institutions (e.g. banks and government bodies) via blockchain technology.
SafeMoon is the baby of the cryptocurrency world compared to more established digital assets like Bitcoin and Dogecoin; the DeFi token was launched into the market just a few weeks ago. Despite its youth, SafeMoon is already the talk of the town. In this explainer, we'll dive into everything you need to know: what is SafeMoon, how to buy SafeMoon and whether it's a worthy investment.
- How to buy SafeMoon
- The world's first Bitcoin rewards credit card is coming — how to get it
- Laptops with the longest battery life 2021
What is SafeMoon?
Let's get into the meat and potatoes of SafeMoon. As mentioned, SafeMoon, launched on March 8, 2021, is a digital asset that seeks to fulfill decentralized-finance ambitions. Like Dogecoin, Bitcoin and Ethereum, SafeMoon runs on blockchain technology. A blockchain is a public ledger shared among a peer-to-peer network that records information about every single transaction.
If the concept of a blockchain is too abstract for you, just picture a large network of computers that cuts out the need for middlemen (e.g. banks) because it verifies transactions via machine consensus. The process of securing and verifying these cryptocurrency transactions is called "mining." In fact, the current graphics card shortage is fueled by the blockchain industry; graphics cards are vital for computing complex algorithms on the blockchain.
What makes SafeMoon different from other DeFi tokens is that it charges sellers a 10% fee and redistributes half to other holders to incentivize buying and holding. You see, SafeMoon seeks to rectify two issues that plague the cryptocurrency industry: investors' bad habit of premature selling and extreme volatility. As such, the SafeMoon team is hoping that the 10% fee thwarts SafeMoon holders from panic selling.
Is SafeMoon a safe investment?
Despite the SafeMoon team's attempts to curb volatility, DeFi token's price fluctuates wildly. On March 20, SafeMoon was trading at $0.000000073. A month later, SafeMoon reached an all-time high of $0.000014. That's a whopping 19,078% increase! If you were nutty enough to drop $7,300 on SafeMoon in mid-March, 30 days later, you'd have $1.4 million on your hands. Cha-ching!
However, after that $0.000014 peak, SafeMoon is now trading at $0.00005 as of this writing, which is a 64% drop. Some are optimistic about SafeMoon and believe it will emulate Dogecoin's skyrocketing growth. Others, however, are skeptical; some have even gone as far as calling SafeMoon a "Ponzi scheme."
A Ponzi scheme is an investing scam that creates returns for earlier investors by taking money from later investors, which skeptics say sounds awfully similar to SafeMoon's 10% seller fee stipulation. Furthermore, cryptocurrency pundits warn that SafeMoon has no real value.
"I think investors need to be cautious about a cryptocurrency that has no real utility. It's clear that the SafeMoon team wants to reward loyal users, but if the cryptocurrency has no real use, what's the point of holding onto it forever?" Clayton Moore, CEO of NetCents Technology (a crypto-based payment processing platform), told US News and World Report.
However, I could argue that Dogecoin and other digital assets have low utility as well. Many people use cryptocurrency as an investment vehicle, hoping that the price skyrockets and increases their ROI exponentially. Many SafeMoon supporters share the same sentiments for their lunar-inspired DeFi tokens; it's just a "high risk, high reward" investment vehicle.
SafeMoon is a highly speculative asset, especially since it's still in its nascent stages in the cryptocurrency world. It's too early to say whether it has potential for growth; it could crash and burn just as quickly as it rose to unexpected heights.
How to buy SafeMoon
You can't purchase SafeMoon on Coinbase. You'll have to buy SafeMoon on one of four exchanges: PancakeSwap, BitMart, Gate.io and WhiteBit. PancakeSwap is the most popular platform for purchasing SafeMoon.
Buying SafeMoon is a mind-warping process. You'll need to purchase BNB (BinanceCoin) and convert it into SmartChain before you can acquire SafeMoon tokens. Although the process is a little convoluted, don't worry. We've already published an easy-to-follow guide on how to buy SafeMoon.
The SafeMoon team has plans to launch its own SafeMoon exchange. According to the SafeMoon Twitter account, the team has successfully fundraised $1 million for the project.
We’ve done it! YOU’VE DONE IT! Fund raiser complete! Thank you so much! All will go towards the #SAFEMOON EXCHANGE! 🚀🌕 we look forward to sharing our updated plans with you... pic.twitter.com/CTrzxhgkhcApril 27, 2021
Hopefully, this SafeMoon exchange will make the buying process less labrythine, however, we won't be holding our breath. As with any cryptocurrency investment, make sure to research your targeted digital asset thoroughly before taking the plunge with your hard-earned money.
Note: This is not financial advice. Digital tokens are extremely volatile, so buy at your own risk.