As a crypto newbie, safemoon has garnered quite a lot of attention across crypto circles since it was created in March 2021. Safemoon was designed to remove some volatility in the crypto market and encourage investors to make hodl long-term. Safemoon had a huge run-up in April but then dropped back. So investors have become cautious about buying safemoon. In this article, we will point out the pros and cons of buying safemoon that you should know.
What Are the Advantages of Safemoon?
Safemoon can bring investors passive income. It aims to encourage long-term investing and punish selling. Any investor who sells will be charged a painful 10% fee, half of which is added to a liquidity pool to maintain price stability.
The other half is allocated to existing holders of safemoon.
In this sense, whenever other investors sell, safemoon holders will generate passive income. In the period when selling pressure rises, safemoon investors will generate more passive income as a return on holding.
Those fees may not be able to offset the decline in safemoon price during those stretches, but they help compound returns if prices eventually recover.
What Are the Disadvantages of Safemoon?
The biggest disadvantage is, Safemoon is a meme coin rather than a token that has an actual use case. It cannot be used in the real world and it doesn’t solve any problem.
It also suffers high volatility and lack of liquidity like other cryptos. Investors who prefer an adrenaline rush or a speculator’s high may feel thrilled due to the skyrocketing and crashing of safemoon. However, the fact that safemoon charges fees to punish selling makes the market far less liquid than other popular cryptos.
Should I Invest in Safemoon?
Since its launch, the safemoon price has increased by 3253%. There is no doubt this token is designed for one purpose – to increase in value. Tokenomics at play incentivizes investors to hold it to earn passive income from the transactions. In addition, it also has attracted more investors, which has pushed up the price.
You can take a glance at safemoon because it has a huge community backing it. However, there is also a risk in investing in it.
For example, safemoon, like other cryptocurrencies, is highly volatile. In addition, there may be liquidity challenges. So, it’s wise for you to conduct your own fiscal investigation instead of being a blind investor who puts all his life savings in this asset class.
Where can I buy Safemoon?
Safemoon is now live on many top exchanges, such as Gate.io which has a simpler and user-friendly interface. Whether you are a pro or a beginner, you can find quality features for all levels there. With the latest 2FA technology to guard your assets and 1000+ other currencies to trade, you can enjoy trading to the fullest.