The latest arrival in the world of cryptocurrencies is SafeMoon, launched 8 March 2021. Looking at their website, it is clear the developers’ main fear is how cryptocurrency speculators, in particular the ‘whales’, create valuation bubbles that almost inevitably burst, damaging the brand and its future prospects.
To address this problem, SafeMoon have focused on the development of what it describes as its ‘secret sauce’: an automatic liquidity pool, whereby loyal investors are rewarded and speculators are discouraged. Under this system, sellers will pay a 10% penalty, half of which is redistributed to existing holders, helping to create what they hope will be a ‘price floor’.
SafeMoon is essentially aiming to take a leaf out of Warren Buffett’s book on investment. The developers are keen to promote the ‘buy and hold’ philosophy, to get away from the cryptocurrencies’ tarnished reputation as the wild frontier of the investment world. As SafeMoon says on its FaceBook page: “Remember, getting to the moon takes time and the longer you hold, the more tokens you pick up.”
SafeMoon: the next steps
So, what are the next steps for SafeMoon? The developers say they are working on the integration process with WhiteBIT, a crypto-to-fiat currency exchange offering more than 150 trading pairs, and BitMart, the cryptocurrency trading platform. In the second quarter, they will start developing the NFT Exchange, (where crypto users and companies can trade non-fungible tokens), the SafeMoon Exchange and explore options with other exchanges such as Binance and Mandala. They aim to hire more staff, open an office in UK/Ireland and develop links with African markets. Underlining their social responsibility, SafeMoon is developing charity projects, scholarships, crypto educational apps and video games featuring SafeMoon.
Any investment decision has to weigh value and potential for growth, and the same applies to cryptocurrencies. Each Bitcoin is already worth some $60,000, with not-unrealistic forecasts of $100,000 given that institutional uptake is only just gathering momentum. BlackRock, Mastercard, Tesla and PayPal are all on board, while Bitcoin was up 3% in London this week on news that VISA is planning to join too.
If Bitcoin continues to grow in value then so could other cryptos, such as Ethereum, Chainlink, Synthetix and Doge. And why not SafeMoon?
Over 1500 cryptocurrencies have crashed
Cryptocurrencies are gaining popularity, with some 106 million users globally trading in more than 2,300 cryptocurrencies. However, 1,620 have crashed (‘dead coins’), highlighting the fact that some cryptocurrencies, despite their best laid plans, just fail to take off. Reasons vary, from security issues, bad press, bad planning or plain fraud.
In January this year, Gemcoin founder Steve Chen was sent to jail for 10 years for defrauding investors. In December 2014, Paycoin founder Josh Garza declared, “I have confidence that Paycoin will be established as the new dominant global online currency”, and that it would have a ‘floor’ of $20 – in 2015 it collapsed, and Garza later pleaded guilty to a wire fraud charge.
Yet, despite the failures and the fraudsters, newcomers keep coming, surely the expression of the confidence of the market in what is still a relatively new sector. SafeMoon seems to be trying to address the weaknesses of cryptocurrencies, in particular with its 10% sales charge to encourage investors to buy and hold. Gaining the backing of any market is not easy but, for the fickle and volatile crypto market, it is critical.