What is SafeMoon?

• 19 Apr 2021, 11:14
• Updated : 20 Apr 2021, 13:48

• Invalid Date,

A NEW cryptocurrency called SafeMoon has gained popularity in recent days and as a result, surged in value.

It launched this month, but what exactly is SafeMoon? Here, we explain everything you need to know.

Read our cryptocurrency live blog for the latest Bitcoin updates

But first, a word of warning: buying cryptocurrencies and decentralised finance tokens as well as stocks and shares is a risky business.

Investing is not a guaranteed way to make money, so make sure you know the risks and can afford to lose the money.

Cryptocurrencies and decentralised finance tokens are also highly volatile, so your cash can go down as well as up in the blink of an eye.

What is SafeMoon?

Not a huge amount is known about Safe Moon meaning the risk to your investment may be even higher.

Technically it’s not a cryptocurrency — it’s an DeFi token — according to it’s website.

DeFi stands for decentralised finance token. They are very complex but essentially aim to disrupt the finance world to enable people to follow and lend in peer-to-peer networks, without needing a bank.

Like Bitcoin they use a complicated method called blockchain technology.

5 risks of crypto investments

THE Financial Conduct Authority (FCA) has warned people about the risks of investing in cryptocurrencies.

• Consumer protection: Some investments advertising high returns based on cryptoassets may not be subject to regulation beyond anti-money laundering requirements.
• Price volatility: Significant price volatility in cryptoassets, combined with the inherent difficulties of valuing cryptoassets reliably, places consumers at a high risk of losses.
• Product complexity: The complexity of some products and services relating to cryptoassets can make it hard for consumers to understand the risks. There is no guarantee that cryptoassets can be converted back into cash. Converting a cryptoasset back to cash depends on demand and supply existing in the market.
• Charges and fees: Consumers should consider the impact of fees and charges on their investment which may be more than those for regulated investment products.
• Marketing materials: Firms may overstate the returns of products or understate the risks involved.

SafeMoon claims it will reward people who buy and hold onto the cryptocurrency.

For those who sell the currency on will be slapped with a penalty.

Its Facebook page states: «Remember, getting to the moon takes time and the longer you hold the more tokens you pick up.»

SafeMoon charges sellers a fee worth 10% of the amount of the cryptocurrency they are flogging to buyers.

It then claims to reward investors that hold onto their purchases by redistributing 5% of the cash gained from the penalty charge among those who already have the currency.

These multi-level marketing tactics mean that is requires more buyers to keep buying to keep the price up, making it a very risky investment.

As always you should never invest any money that you aren’t prepared to lose.

SafeMoon recorded a 99% rise on Sunday after Bitcoin had its biggest single day drop for months.

Is SafeMoon legit?

It is unclear if Safemoon is legit. Very little is known about SafeMoon and this could mean that your money is at higher risk.

This is because cryptocurrency firms are not regulated. This means that you won’t have any protection if things go wrong.

Investing is always a risk but investing in cryptocurrency is an even higher risk as they are VERY volatile.

SafeMoon’s founders have been holding «Ask Me Anything» sessions to reassure investors.

The founders are based in the US, where there are some regulations around the sale of cryptocurrencies.

Before investing you should do your research and make sure that companies are not a scam and you’re only investing money if you can afford to lose it.

UK Crypto asset businesses must register with the Financial Conduct Authority — and you can check to see if they are on the Financial Services Register or if they are on a list of firms with temporary registration.

There is also a list of businesses not registered. If they are on this list then they may be operating illegally.

Even if they are on the list the city watchdog is not responsible for regulating them and they don’t have any power over how they conduct business with customers.

Essentially it is very hard to tell which firms are real and which ones are scammers.

Currently SafeCoin is listed on the BitMart exchange but not on the major leading platforms Coinbase or Binance.

It comes after Dogecoin’s price increased 91% in 24 hours after Elon Musk tweeted about the cryptocurrency — and a 20,000% increase from this time last year.

How to spot crypto scams

CRYPTO scams are popping up all over the internet. We explain how to spot them.

• Promises of a high or guaranteed return — Does the offer look realistic? Scammers often attract money by making fake promises.
• Heavy marketing and promotional offers — If they are using marketing tricks to con customers you should beware.
• Unamed or non-existent team members — Just like any business you should be easily able to find out who is running it.
• Check the whitepaper — Every crypto firm should have a white paper. This should explain how it plans to grow and make money. If this doesn’t make sense, then it could be because the founders are trying to confuse you.
• Do your research — Check reviews online and Reddit threads to see what other people think.

The cryptocurrency, which started as a joke, has risen 365% in the past month to close to 20p per unit.

It comes despite the currency not being listed on any cryptocurrency exchange platforms

https://www.thesun.co.uk/money/14692373/what-is-safemoon/