Is SafeMoon A Good Investment?

Introduction

The SafeMoon Protocol is a community-focused and fair DeFi Token. The founders wanted a coin that would ensure “safe” gains and prevent the inevitability of bubbles. Holders earn passive rewards over time, and penalties discourage selling. Three simple functions occur during each trade:

1. Reflection; 5% is reflected to all holders for passive income.
2. LP Acquisition; 5% is added to a liquidity pool.
3. Burn; A burn wallet receives a portion of the reflections never to be seen again.

SafeMoon team claims that prior cryptocurrencies have some problems that SafeMoon tries to address. These problems include mining rewards, farming rewards, and liquidity provisioning. 

How Does SafeMoon Work

As mentioned, SafeMoon is developed bearing in mind some major issues including mining rewards, farming rewards, and liquidity provisioning. Due to its financial incentives, mining is still interesting for miners, although the required equipment is costly and can cause harm to the environment. As a solution, SafeMoon proposes an alternative method instead of mining rewards, ie., allowing users to participate in a smart contract token reflection to produce tokens inside their own wallet.

It is the responsibility of developers to create incentives for users to provide liquidity, which is an essential element for users participation. As a solution, SafeMoon uses a smart contract function to automatically capture liquidity to be used on the decentralized exchanges and held in custody independent from user possession. Moreover, utilizing a smart contract to automatically burn tokens can promote scarcity. The combination of these two tokenomics can provide benefits for the community.

Financial Analysis

Gaining public attention is a critical factor in determining the success of any project. Our data shows that SafeMoon's popularity has grown over the last five months. Its Twitter account saw an increase of 37% in the number of followers, rising from 791k on May 21, 2021, to more than one million on October 17. Moreover, SafeMoon's popularity on Reddit and Telegram also has grown over the same period with 19% and 3%, respectively.

Considering market capitalization rank, SafeMoon saw an overall declining trend during the last six months. Starting from the rank of 41 on May 21, 2021, SafeMoon's market cap ranking declined constantly reaching 104 by the time of writing this post with approximately $1 billion. Moreover, its liquidity score is 43% below the market's average score, making it challenging to sell SafeMoon if the market is falling. SafeMoon's price followed a relatively similar trend to its market cap ranking, seeing an overall decreasing trend over the same period.

Finally, although it is too soon to talk about its annual Return On Investment (ROI), if you had bought SafeMoon a month ago, you could enjoy a 5% profit on your investment.

You are saying that SafeMoon is the best cryptocurrency to invest in?

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