With an increase in attention to Dogecoin due to Elon Musk’s tweets regarding the cryptocurrency, the Shiba Inu themed crypto has skyrocketed, becoming the 4th largest cryptocurrency in the world. To put this in perspective, Dogecoin is worth more than Ford, American Airlines and Moderna.
Since Dogecoin has reached the masses, investors are looking for similar cryptocurrencies that could offer them high returns. This is reminiscent of how AMC, BBBY and NOK pumped alongside Gamestop in January. One of the most popular meme cryptocurrencies is Safemoon, and it’s risen over 1,000% since its launch in March 2021.
What is Dogecoin?
Dogecoin was created by Billy Markus and Jackson Palmer in 2013. The founders have aimed to create a more fun, usable and community oriented cryptocurrency to compete with Bitcoin. Dogecoin doesn’t have many unique features that give its token a competitive advantage; the code for Bitcoin was actually just edited to create Dogecoin.
One advantage Dogecoin has over Bitcoin is its faster transaction times, but other altcoins have much faster transaction throughputs than DOGE, so its technology is arguably obsolete. However, transaction times are just one aspect of cryptocurrency. Security is much more important to most investors, and cryptos like Bitcoin and Ethereum are multitudes more secure than Dogecoin.
What is SafeMoon?
SafeMoon is a very new cryptocurrency which began trading in March 2021. The token began trading at $0.000000001 with an incredibly small market cap. Since then, SafeMoon has pumped to about $0.000012 before retracing back to about $0.000004. Even at this price, early investors have made well over 1,000% in the span of just a few months.
The cryptocurrency is a BEP-20 token, meaning it uses Binance Smart Chain to secure its network. The token doesn’t have any clear use cases, other than “going to the moon”. The company describes itself as a DeFi token, but Binance Chain is far from decentralized. Binance must approve validators, in a consensus model called proof-of-authority. Even CZ, the CEO of Binance, has explained Binance Smart Chain as “CeDeFi”, or “Centralized Decentralized Finance”.
Safemoon Tokenomics vs Dogecoin Tokenomics
Tokenomics is a term used to describe the economics of cryptocurrency tokens. While both Dogecoin and SafeMoon have questionable tokenomics, Dogecoin seems to have a more sound monetary policy than SafeMoon.
SafeMoon has a maximum supply of 10,000,000,000,000,000 (10 quadrillion) tokens, yet it only has about 600,000,000,000 of these tokens in circulation. Technically, SafeMoon is a deflationary currency, as the supply decreases with time. However, this deflationary policy resembles more of a pyramid scheme than a sound monetary policy. When investors sell their SafeMoon, they’re charged a 10% fee for doing so. 5% of this fee is burned, and the other 5% is redistributed to SafeMoon investors. Essentially, investors rely on more people buying into SafeMoon to increase their investment.
Dogecoin works in a similar way to Bitcoin. It uses a proof-of-work consensus model, meaning that miners secure the blockchain network in exchange for Dogecoin rewards. Whereas the Bitcoin reward halves every 4 years, Dogecoin’s block reward is static at 10,000 Dogecoin per block.
Dogecoin vs SafeMoon Market Capitalization
Another important factor to consider is the market capitalization of these cryptocurrencies. Dogecoin has risen to the 4th largest crypto with a market cap of over $80 billion. This is more than double what Ethereum’s market capitalization was in October 2020, just a few months ago. With such a large market capitalization, it’s hard to believe DOGE can continue to rise in price at the same rate it has for the past few months.
According to SafeMoon’s website, the token has a market cap of $2.3 billion. While this is nothing to scoff at, it’s still much lower than the market cap of Dogecoin. Since SafeMoon has a much smaller market cap, it takes significantly less capital investment to double in price than it would for Dogecoin. Most investors would agree that SafeMoon has higher potential for returns than DOGE, albeit an extremely high risk investment.
Where to Buy SafeMoon
SafeMoon uses the Binance Smart Chain to secure its network, so it’s a bit harder to invest in than other cryptocurrencies. The token is unavailable on centralized exchanges like Coinbase, Gemini and eToro. Instead, you’ll need to use Pancakeswap, a “decentralized” exchange ran through smart contracts on the Binance Smart Chain.
To use Pancakeswap you’ll need to download either Trust Wallet or Metamask, and then connect your wallet to operate with Binance Smart Chain. If you don’t have a Binance account, you’ll need to make an account with them as well. You need to purchase Binance tokens (BNB) to use Pancakeswap, so you’ll need to buy these on Binance’s exchange.
Once you’ve sent your BNB tokens to your crypto wallet, you’ll need to convert them to operate on Binance Smart Chain. After you’ve done this you’re able to use your BNB tokens on Pancakeswap to buy SafeMoon.
Where to Store SafeMoon Tokens
If you’re not investing a lot of money in cryptocurrency, then a software wallet is an accessible storage option. Software wallets like MetaMask and Trust Wallet secure your crypto in computer programs, and these wallets are free to use.
If you want to store your crypto assets in the safest way possible, then you should opt for a hardware wallet. Hardware wallets let you store cryptocurrency offline, making it impossible for online hackers to access your funds.
- Crypto enthusiasts
Best Hardware Wallet for SafeMoon: SafePal S1
The SafePal S1 is one of the only hardware wallets that currently supports Binance Smart Chain BEP-20 tokens. Since the SafePAl S1 is a multicurrency wallet, you can store your Bitcoin, XRP, Ethereum and almost any other cryptocurrency in your SafePal wallet.
The hardware wallet comes in at a cheaper price than most other hardware wallets, costing just $40. This makes the SafePal S1 an extremely attractive option for cost-conscious investors, especially considering the variety of cryptocurrency the wallet supports.
Where to Buy DOGE
Dogecoin is much easier to purchase than SafeMoon, so novice investors may choose to buy DOGE over SafeMoon simply because it’s easier to buy. Dogecoin can be bought on Robinhood, but many investors choose a cryptocurrency exchange to have access to a variety of cryptocurrencies.
Some popular cryptocurrency exchanges that support Dogecoin are Gemini and Voyager. Depending on where you live, you may have to provide personal identification information to the website for tax purposes.
DOGE or SafeMoon?
Both Dogecoin and SafeMoon are fundamentally poor investments. Neither of these projects have competitive advantages over other cryptocurrencies, and it’s not likely that these high prices will be sustainable over the long term. If you plan on investing in either of these crypto assets, be sure not to buy more than you’re willing to lose.
If I had to choose, I’d pick SafeMoon. Dogecoin’s radically high market cap makes it hard for the coin to continue to increase in value, and it doesn’t seem like there is much more upside to the Shiba Inu cryptocurrency. While SafeMoon is clearly a pyramid scheme, there seems to be a higher potential reward for the risk you’re taking on by investing in the token.