Can You Trust SafeMoon?

Great Success, but What About Due Dilligence?

Recently many launched projects have encountered wild success partly thanks due to marketing and social media, especially TikTok and Twitter. Clearly, the success of a project can correlate a lot with how much of a reach the token name achieves on those social media, which leads to projects owner putting more effort into marketing than they do in having high quality and safe smart contracts.

The Case of SafeMoon

One of these successful tokens that might have started as a joke was SafeMoon. The concept was a simple spin-off of the so-called “reflect token” system. Basically implying that part of all tokens in each transaction would be “reflected”, meaning that every user balance is calculated from the smart contract logic instead of being a simple counter. In practice, that means that when a transaction happens, a reflect tax is applied on it and the holder balances then increase accordingly.

SafeMoon, Maybe Not so ‘Safe’ After All…

When SafeMoon launched, not much was revealed about the technical details in terms of how it was going to achieve what it promised. And in fact, one could say that a lot of the early marketing for the token was even misleading. SafeMoon was advertised as “anti-rugpull” and as having its liquidity locked for 4 years… And to this day the website of the project remains very ambiguous as to how the locks and burns happen. In this post we’ll look into how true the project’s claims are.

The Many Red Flags in SafeMoon’s Code

Let’s take a deeper dive at the code and dig into how SafeMoon actually works.

  1. On every transfer, check if the contract balance is above a threshold.
  2. If that threshold is met, market sell half the contract balance into BNB using the PancakeSwap router.
  3. Add BNB + SafeMoon liquidity to the PancakeSwap router, using the owner address.

Worst Case Scenario

In this scenario, the owner would wait until he owns a substantial amount of the LP tokens.

Conclusion

While SafeMoon’s team has been very successful at marketing their project, it’s clear that there are many major red flags in the project’s smart contract code. The SafeMoon smart contract leaves users open to being exploited in several different ways by the project’s developers.
Investors should be extremely careful of the security risks involved while dealing with un-audited smart contracts.

What Obelisk can do for you

At Obelisk our expertise lies in smart contract auditing, development and security. We firmly believe that security is the foundation of building successful projects in the Decentralized Finance space and we always strive to help our partners succeed with ambitions through our auditing services. If you are an investor that wants to safely delve in a DeFi project, a developer that is seeking to launch a new blockchain project or perhaps an already established project looking to improve security and transparency and gain user trust then we would love to hear from you. Get in touch about your audit now through the channels below:

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