![]() In an interview from his home in the U.K., John Karony, SafeMoon’s 25-year-old chief executive officer, emphatically denied that his token is a Ponzi scheme. “What differentiates SafeMoon is that they’re putting this out there in the open for everyone to see, and are not trying to hide the fact that’s how the system works,” he said. Jack Purdy, a senior research analyst at crypto analysis firm Messari Inc., said that while he didn’t know how risky SafeMoon might be, its website makes it clear that it’s designed to get investors to buy and hold to “earn passive rewards through static reflection as they watch their balance of SafeMoon grow indefinitely.” A Barstool Sports spokesperson was unable to confirm whether Portnoy still owns SafeMoon. In about an hour, the price of SafeMoon rose 18 per cent. “If it is a Ponzi, get in on the ground floor,” he said. ![]() ![]() In May, he announced to his 2.6 million followers on Twitter that he’d bought US$40,000 worth, despite saying that SafeMoon could be a Ponzi scheme, a scam in which early investors’ returns are paid with funds coming from later buyers that collapses when new deposits dry up or too many people try to cash out. One investor who wasn’t deterred was Barstool Sports Inc. “Whenever there’s some sort of mechanism to stop selling, that’s a bit of a warning sign.” ![]() “The manual burns, alongside the company having a pretty large stake in the coins, just speaks to me of a manipulation risk,” said Jasper Lawler, head of research at London Capital Group, an online brokerage firm offering cryptocurrency derivatives. Critics also worry about the discretionary nature of the “manual” coin burns used to adjust its circulation. SafeMoon calls itself a DeFi token, or one that uses decentralized finance to govern functions through software, but it has a chief executive officer and chief operating officer. Half of these fees are paid to owners as an incentive to keep holding and the other half goes into a liquidity pool controlled by the developers. It charges a 10 per cent fee to buy tokens and another 10 per cent to sell - almost unheard of in the digital currency world. Yet some crypto watchers have raised red flags over SafeMoon’s unusual structure. Though the price of the four-month-old token has dropped since then, more than 2.4 million investors have bought it, according to its developers. To investors hunting for the next Dogecoin, the more than 19,000 per cent price gain that cryptocurrency SafeMoon posted in its early weeks was like catnip. The information on this site is not directed at residents of the United States, Canada, Singapore, Japan, Korea, Australia, and New Zealand or any particular country or jurisdiction where such distribution or use would be contrary to local law or regulation.Join the conversation SafeMoon calls itself a DeFi token, or one that uses decentralized finance to govern functions through software, but it has a chief executive officer and chief operating officer. Neither the firm nor investments in cryptoassets are regulated by the Financial Conduct Authority, nor covered by the Financial Ombudsman Service or subject to protection under the Financial Services Compensation Scheme. It is your responsibility to ascertain whether you are permitted to use the services of Binance based on the legal requirements in your country of residence. Before trading, please take into consideration your level of experience, investment objectives, and seek independent financial advice if necessary. You should not invest more than you can afford to lose and you should ensure that you fully understand the risks involved. Trading cryptocurrencies involves significant risk and can result in the loss of your capital. Nest Services Limited, trading as Binance, is the entity ultimately responsible for the Binance Services offered through the Platform.
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