The cryptocurrency market moves extremely fast, with thousands of available tokens for people to invest in. The likes of Bitcoin and Ethereum are well-established now, while even a parody coin like Dogecoin has posted huge gains this year. However, the majority of smaller and unknown coins fade away to obscurity. While this may yet occur to Safemoon, early indications are that it could be a coin to keep an eye on, as it has posted significant gains and trading volumes already since its launch in March 2021.
One of the biggest reasons for the interest in Safemoon is one of its unique features that is not found in any other crypto token. This is the 10% fee that is charged to anyone who sells their tokens, with half of this fee being distributed to all other Safemoon owners. The purpose of this penalty is to discourage selling and therefore incentivize people to hold the token, as the redistributed fee also acts as a reward for doing so. This makes it very different from every other crypto token out there, all of which can be sold freely and is part of the reason why the token has already racked up more than 1 million users. It could also be seen as a more serious and stable version of Dogecoin – Safemoon’s slogan is “safely to the moon”, which is a play on the popular Dogecoin rallying cry of “to the moon”.
Safemoon has already proved to be popular in various countries, including Canada. Canada is one of the few countries in the world which has had a very open approach towards crypto – there are various crypto exchanges in operation in the country, while it is also the only one in the world where Bitcoin and Ethereum ETFs have been approved and are available for investment on the Toronto Stock Exchange. The Canadian crypto startup economy is also thriving as a result of these regulations and the overall attitude of the government towards crypto, so it is no surprise that a crypto token such as Safemoon which is trying to innovate in some manner has gained a lot of interest in the country’s crypto market.
Of course, this token is a long way off Bitcoin and Ethereum’s value, currently hovering around $0.000005. This price is less than half of where it was earlier in April but is still quite higher than its launch price of $0.0000000010. However, this shows that Safemoon has been just as volatile as other cryptocurrency tokens, if not more, which defeats the purpose of the selling penalty. There are also concerns around the business model itself, as it may rely on more and more people buying the token at higher prices to provide returns for existing buyers, which is the definition of a Ponzi scheme. The selling fee is a great way to incentivize existing investors to hold on, but it can only pay out if there are new buyers – if nobody buys the token, there is no selling penalty to pay out, and this could lead to a sharp fall in the price.
Of course, these are still very early days in terms of Safemoon’s existence on crypto markets, and so we will have to wait and see how this token evolves and develops. For those who want to own Safemoon, it is a slightly convoluted process. There are four exchanges where Safemoon can be bought – PancakeSwap, BitMart, WhiteBit, and Bakery Swap. However, the token cannot be bought directly like Bitcoin or Ethereum – you need to first buy Binance coins and swap these for Safemoon. There is potential slippage to consider as well here, due to the selling fee, so you will not receive less than the amount of Binance coins that you swap for. However, there are plans to release a dedicated Safemoon wallet, which will make it much more convenient to buy this token.
Safemoon is an interesting new cryptocurrency with a unique feature that sets it apart from all other tokens. However, only time will tell whether this feature is good enough to support the token’s growth, or whether Safemoon will also eventually crash and burn as many other crypto tokens have done in the recent past.