The tranquility surrounding embattled altcoin project SafeMoon was disrupted on February 12, 2024, when the Cyvers Alerts monitoring system detected a series of irregular transactions. These transactions raised new concerns about the stability and potential mismanagement of the project following the bankruptcy filing of its last US arm. Here are the details…
Unusual activities in altcoin project
According to Cyvers Alerts, the SafeMoon distributor added an address starting with “0xc18” as “approveLiquidityPartner”. This newly added address then continued to systematically withdraw liquidity from various liquidity pools on the Ethereum, BNB, and Polygon chains. While the total value of the issued assets was estimated to be approximately $11.2 million, investors began to search for answers in confusion.
Adding to the confusion, the transferred assets were sent to a wallet address starting with “0x6f9”, and its purpose and ownership remain unclear. SafeMoon’s lack of transparency regarding these events has fueled speculation and concern within the community. The timing of these suspicious transactions is particularly concerning as it occurred just a few weeks after SafeMoon US LLC, the American arm of the project, declared bankruptcy on January 19, 2024.
Unforeseen circumstances attracted attention
While the official statement attributed the bankruptcy to “unforeseen circumstances,” many community members expressed concerns about potential mismanagement and misuse of funds. The connection between the bankruptcy and recent on-chain activity remains unclear. However, the timing and nature of the transactions raise valid questions about the financial health of the project and the security of user funds.
What is Safemoon?
Safemoon is considered a decentralized finance token and is built on the Binance Smart Chain network. What differentiates Safemoon from other cryptocurrencies and tokens is that it encourages holding your tokens and discourages selling. When someone decides to sell their tokens, they are subject to a fee as high as 10%. According to the Safemoon white paper, half of this fee is redistributed among the remaining Safemoon holders, while the other half is added to the liquidity pool to offset selling pressure and provide a price floor.
Unlike many tokens developed on the Ethereum Blockchain, the Safemoon token has no real utility in terms of practical use beyond an attempt to make a profit if the price of the coin increases. Critics of the coin have compared it to a Ponzi scheme, and it’s hard to ignore the glaring similarities. Because Safemoon’s value is based on marketing, hype, and celebrity endorsements, it lacks solid foundations to stand on, creating a risky situation for buyers.
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