Introduction

SafeMoon is a cryptocurrency platform built on the idea of rewarding long-term holders of its native token, SFM. It utilizes a unique system of reflections, liquidity pool acquisition, and burns to incentivize holding and potentially boost the token’s value. However, the project has been surrounded by controversy, with its executives facing legal charges in the United States.

This article explores the SafeMoon ecosystem, its token (SFM), and its approach to decentralized finance (DeFi). We will delve into its features, potential use cases, and the ongoing legal issues surrounding the project.

What is SafeMoon (SFM)?

SafeMoon is a Web 3.0 platform built on Binance Smart Chain, Polygon, and Ethereum networks. It adopts a static reward system to boost community engagement. SafeMoon’s static reward model, known as Reflection, requires users to hold SFM tokens for a long time without selling. In return, they get incentives based on the number of tokens they are holding.

Additionally, SafeMoon uses a deflationary mechanism to control the market supply of its native tokens; adopting a manual burn mechanism to remove tokens from circulation and adjusting its token availability in the market.

SafeMoon Ecosystem

The SafeMoon ecosystem revolves around the following:

SafeMoon Community

The SafeMoon community is the soul of the ecosystem. It touches on customers, people whose SafeMoon’s products are meant to serve. The SafeMoon community in different social platforms builds conversation around the SafeMoon project, product offerings, partnerships, and the development team.

SafeMoon Partners

SafeMoon partners include persons and projects that SafeMoon has chosen to work with on the Swap and Technology program. Due diligence procedures are taken in the SafeMoon Swap and technology program to onboard new partners. For instance, the SafeMoon token listing application ensures that necessary details about new partners and their tokens are documented before onboarding.

SafeMoon is open to partnering with developers and innovators who are building on the blockchain following an open invitation on its website. Already, SafeMoon is in partnership with Mirror Protocol, Blockbusters, Grove, JpToken, Crogecoin, etc.

Growth Fund

SafeMoon also claims to be raising a growth fund to support its Impact Circle. The SafeMoon Impact Circle claims to have touched lives through 150 days of education, 35 days of medical care, 3,891 nourishing meals, providing clean water, and planting over 2,299 trees.

SafeMoon Features

Here, we will explore the various features and functionalities offered by SafeMoon, including its Wallet, Bridge, Swap, Orbital Shield, and Focus Map.

Wallet

SafeMoon Wallet manages users’ assets on the platform. While the wallet stores tokens, it serves other needs such as automatic token distribution and biometric authentication.

Bridge

The SafeMoon bridge cuts across different blockchain networks including Ethereum, Polygon, and Binance Smart Chain (BSC). It allows users to cross between these multiple chains using the SFM token. For example, users can easily bridge SFM tokens on Ethereum to SFM on Polygon on a 1:1 ratio.

Swap

SafeMoon swap is used to convert tokens at a fee. To use SafeMoon swap, users need to:

• Connect their wallet to Binance Smart Chain, Ethereum, or Polygon networks
• Select the tokens they want to swap (for example, BNB, ETH, or MATIC) then
• Swap

Merch Store

SafeMoon Merch Store, also called merchandise store, is an online shop where SafeMoon branded items are sold. It comprises branded mugs, tumblers, stickers, hoodies and beanie bundles, T-shirts, and more.

SafeMoon Orbital Shield

Source: SafeMoon

SafeMoon’s security feature is the Orbital Shield. It is a robust security launched to keep the SafeMoon ecosystem safe. Its security solution is for anonymized data protection.

The SafeMoon Orbital Shield protects its ecosystem through an anonymized encryption process that does not collect the personal data of SafeMoon users. Built with 256-bit encryption, the SafeMoon Orbital Shield minimizes risks associated with conventional user authentication.

Focus Map

SafeMoon’s Focus Map is a layout of products, services, and features that SafeMoon’s team is working to implement. While some of these products and features have been completed, others are still under development, hence not fully operational. So far, SafeMoon has successfully implemented;

• SFM V2 token migration
• Swap feature
• Wallet application and
• Multi-chain wallet support

On the other hand, the following products and services are under development, they include;

• Creating explainer videos for cross-chain bridges
• Multi-chain NFT marketplace
• Safemoon card
• Safemoon blockchain mainnet

Brief History of SafeMoon

SafeMoon was launched on March 8, 2021 on the Binance Smart Chain (BSC), then later on Ethereum and Polygon networks. SafeMoon has no known team except for Braden John Karony who identifies as the CEO and Thomas Smith, the Chief Technology Officer (CTO). The identity of Kyle Nagy, the acclaimed project’s creator isn’t clear.

SafeMoon’s emergence into the crypto space was characterized by spontaneous popularity and massive community support from crypto enthusiasts, influencers, and celebrities. Its growing popularity attracted massive investment causing a huge pump for its token.

Furthermore, SafeMoon’s popularity surged tremendously when it gained social support and commentaries from popular influencers and celebrities on social platforms. Notably, was a tweet from Jake Paul, a popular YouTuber who also doubles as a professional Boxer. In his tweet, Jake hinted that everyone needs a SafeMoon (SFM).

Source: Jake Paul on X

With the massive support from its community of investors, SafeMoon (SFM) reached an all-time high market cap of $17 Billion in April 2021. Later that year, in December 2021, the project initiated a system upgrade that migrated the SafeMoon token from V1 to V2. SafeMoon V2 is poised to attach tangible use cases to the token moving forward.

Advantages of SafeMoon

• Fully decentralized Web3 platform: SafeMoon is community-driven and allows its users to actively participate in the project’s success. By holding SFM tokens long-term, users help maintain price stability and by making sales, they contribute to SafeMoon’s liquidity pool.
• Robust security: SafeMoon Orbital Shield uses 256-bit encryption to protect user data. The orbital shield anonymizes encryption to prevent the collection of users’ personal data.
• Reward for token holding: SafeMoon rewards holders of SFM tokens with income generated from token sales. Thus, the longer you hold, the more rewards you gain. It also means that the more tokens you hold, the higher your percentage of income gained.
• Automatic LP acquisition: SafeMoon automatically funds its liquidity pool with transaction charges. Thus making token in-flow to the liquidity pool constant. This helps maintain liquidity for the SFM token.
• Deflationary mechanism: Safemoon uses this to ensure long-term scarcity of its token, boost demand, control inflation, and supply, and also maintain liquidity for its token.

Disadvantages of SafeMoon

• Lacks token utility: The SFM token only serves as a store of value; products and services tied to the token have remained speculative.
• Team credibility concerns: The team behind SafeMoon lacks transparency, with only two team members publicly identified.
• Lack of established use cases: Most of the planned features and functionalities are not yet operational.
• Legal issues: The SafeMoon team faces serious legal charges in the US, including fraud and offering unregistered securities. This casts a major shadow on the project’s legitimacy and future.

How Does SafeMoon Work?

SafeMoon works based on three distinct features namely;

• Reflection
• Liquidity Provider Acquisition
• Burn

Reflection

SafeMoon Reflection works by generating a static reward for SFM token holders. It also incentivizes long-term holders. Hence the longer you hold SFM tokens, the more rewards you can compound. This also implies that the quantity of incentives holders receive per time is proportional to their asset holding.

Equally, Reflection is used to mitigate selling pressures caused by early adopters. And also a strategy to maintain price stability for SFM tokens.

Liquidity Provider Acquisition (LP)

SafeMoon liquidity provider is a feature designed to reward token holders and fund SafeMoon’s liquidity pool simultaneously. Under version 1 (V1), SafeMoon liquidity provider charges a defunct 10% transaction fee on token sales and divides it into two. 5% goes into SafeMoon’s liquidity pool and the remaining 5% is shared among token holders in proportion to the amount of tokens they hold.

However, after token migration from V1 to V2, SafeMoon introduced a new transaction fee where the automated LP charges a 2% transaction fee on token sales. Just like V1, 1% of this fee is shared among token holders while the other 1% is deposited into the liquidity pool.

Burn

Safemoon adopts a manual burn as its token deflationary mechanism. This feature manually removes SFM tokens from circulation from time to time. Thus, adjust availability, boost value, control asset supply, maintain liquidity, keep inflation in check, and maintain the long-term scarcity of the SFM token

SafeMoon V1 Vs. SafeMoon V2: What’s the Difference

SafeMoon V1

The SafeMoon V1 was launched in March 2021 with a total supply of 1 Trillion SFM tokens and a circulating supply of 556.62 Billion tokens. The token was released on the Binance Smart Chain (BSC), and later on Ethereum and Polygon networks. SafeMoon V1 made use of DeFi wallets such as Trust Wallet, and Metamask to store the SFM tokens.

Additionally, SafeMoon V1 charged a defunct 10% on all selling transactions to fund its liquidity pool and reward existing token holders. Despite the static reward system fueled by the 10% selling fees, SafeMoon V1 saw a huge pump and subsequent dump after hitting its all-time high market cap of $17 Billion in April 2021.

SafeMoon V2

Following a significant market pump and the corresponding decline that followed, SafeMoon V1 was migrated to SafeMoon V2 in December 2021. The migration consolidated the SFM token V1 to 1000:1 ratio in the V2 version.

For instance, if an existing Safemoon holder owns 100,000 SFM tokens, a 1000:1 consolidation means that for every 1000 SFM tokens in this wallet, the holder gets 1 SFM token. Therefore, for the 100,000 SFM tokens, the holder gets 100 SFM tokens (that is 100,000÷1000 = 100 SFM).

The 1000:1 consolidation is intended to minimize the amount of SFM tokens in circulation and the possession of token holders without affecting its value negatively. Essentially, the technique cancels off three zeros from the circulating supply but keeps the portfolio balance of users the same.

For the record, the SafeMoon V1 to V2 migration wasn’t automatic. Most SFM token holders including SafeMoon wallet users and Non-wallet users were required to update to the latest version of the SafeMoon app and follow the consolidation process to transfer their tokens manually. However, an exception applies to users whose tokens are on the SafeMoon exchange (the migration in this case was automatic).

Differences Between SafeMoon V1 and SafeMoon V2

There are notable differences between SafeMoon V1 and SafeMoon V2, and they include;

What are the Potential Use Cases for SafeMoon V2?

Support for NFT Marketplace

Part of the distinguishing use cases of Safemoon V2 from SafeMoon V1 is their support for the NFT marketplace. SafeMoon V2 will facilitate the minting, buying, and selling of NFTs.

Educational Content

SafeMoon V2 will be used to encourage the creation of educational materials. Notably, to create explainer videos for cross-chain bridges, as well as creating lessons and courses.

Support for Impact Circle

Not only is SafeMoon proposing a use case for the NFT platform and education, but it also proposes what it calls an impact circle. The impact circle intends to support the health system, education, tree planting, and charity. This is fueled by its community-driven approach to decentralized finance.

SafeMoon’s Main Products

SafeMoon Gaming

Source: SafeMoon

SafeMoon Gaming is a community-driven gaming platform for game lovers. It involves a community of game lovers coming together to play a variety of games on the SafeMoon social platform.

For context, SafeMoon gaming releases what it calls the ‘SafeMoon gaming event calendar’ every month. The game calendar stipulates a gaming timetable according to the type of gaming event. Moreso, SafeMoon gaming is open to every game lover. Participants are required to join the SafeMoon gaming community on Discord to participate.

SafeMoon NFT Marketplace

SafeMoon is working to implement a multi-chain NFT marketplace that would support minting and trading of NFTs across multiple chains. It will be a minting hub for content creators. The multi-chain NFT cuts across Solana, Polygon, Binance Smart Chain, and Ethereum blockchain networks. However, the NFT marketplace is not operational at the time of writing.

SafeMoon Insider

Source: SafeMoon Insider

Another part of the SafeMoon ecosystem is the SafeMoon Insider. It powers the education arm of the SafeMoon ecosystem. SafeMoon Insider posts daily news updates within the SafeMoon community. SafeMoon Insider claims it successfully published an article, every day for 365 days, thus making 365 articles between October 2021 and November 2022.

SafeMoon Sales

SafeMoon Sales represents the sales and partnership arm of the SafeMoon ecosystem. The core responsibility of SafeMoon sales is to market SafeMoon to partners and investors. It is responsible for announcing collaborations, and product and service launches with new and existing SafeMoon partners.

SafeMoon Contract Addresses

The SafeMoon Contract address is a flagship feature of the SafeMoon ecosystem. Safemoon contract addresses are the unique identifiers of SFM tokens on the blockchain.

A Significant feature of the SafeMoon contract address is the 42 hexadecimal characters. These digital characters are used to interact with the SafeMoon smart contract. So technically, at the core of SFM token buying, selling, swapping, and transfers is the interaction with SafeMoon contract addresses.

SafeMoon V2 currently has three distinctive contract addresses with three blockchain networks, namely Binance Smart Chain, Ethereum, and Polygon. Below are the contract addresses for each chain:

• Binance Smart Chain Network: 0x42981d0bfbAf196529376EE702F2a9Eb9092fcB5
• Ethereum Network: 0xe574c0c33A7A67d9b09F9F0AdDBB3dCA71A8F3E0
• Polygon Network: 0x0a654cb371FBC3C49Ccb176984D64E86fc931EeA

What is SFM Token?

SFM is the native token of the SafeMoon protocol. It facilitates transactions on the SafeMoon protocol. This includes incentivizing long-term holding of SFM tokens, funding the SafeMoon liquidity pool as well as a store of value by SafeMoon investors.

Tokenomics

Source: Safemoon

SafeMoon has a total supply of 1 Trillion SFM tokens and a circulating supply of 556.62 Billion tokens. SafeMoon incentivizes users for holding its tokens; the longer you hold SFM tokens, the more rewards you get.

Is Safemoon (SFM) a Good Investment?

SafeMoon (SFM) appears highly speculative and risky. While it offers potential rewards for long-term holders through its unique features, such as reflections and liquidity pool acquisition, the project is marred by legal issues, lack of transparency regarding team members, and most of the planned features and functionalities are not yet operational. The ongoing fraud investigations by regulatory authorities and the lack of operational functionalities raise significant concerns about its legitimacy and prospects. Therefore, investors should cautiously approach SafeMoon and conduct thorough research before considering it as an investment option.

Remember, this information is for educational purposes only and should not be considered financial advice. Always consult with a qualified financial professional before making any investment decisions.

How to Own SFM?

You can buy SFM from centralized cryptocurrency exchanges. For example, Gate.io offers traders the following different trading pair: SFM/USDT. To own the token, create a Gate.io account, and complete the registration process. Also, you need to fund your spot trading account and go through the steps to buy SFM.

Highlights

SafeMoon Executives Under Investigation by Regulatory Authorities in the US

SafeMoon CEO, John Karony and CTO, Thomas Smith are currently facing legal charges from the United States Department of Justice for alleged fraud. The team was arrested in November 2023, and charged for alleged withdrawal of over $200 million to fund the purchase of luxury cars and homes using investors’ funds, Coindesk reports.

Also, the United States Securities and Exchange Commission is pressing charges on the SafeMoon team on account of releasing unregistered securities to investors.

SafeMoon CEO Loses Legal Team After Bail Release Amidst Ongoing Fraud Charges

SafeMoon CEO’s legal team is reported to have withdrawn after Braden John Karony was released on bail. Recall that Safemoon CEO, John Karony and CTO, Thomas Smith were arrested and charged to court on account of fraud and offering unregistered securities in November 2023.

However, the project’s creator, Kyle Nagy, remains at large.

The SafeMoon CEO’s legal team announced their withdrawal from legal representation on February 12, 2024, citing lack of funds, and mentioned the appointment of a public defender, Nicholas Smith.

SafeMoon’s CEO was released on an extensive set of conditions, Crypto News reports.

Take Action on SFM

Check out SFM price today and start trading your favorite currency pairs:

• SFM/USDT