SafeMoon (CCC:SAFEMOON-USD) has been generating buzz in recent weeks, after gaining traction on social media and rocketing higher ahead of #DogeDay. It has also been generating scam allegations. Considering all this, SafeMoon requested a CertiK audit on April 21. Those SafeMoon audit results are now ready, and investors are diving into the report.
So what do you need to know? Starting with the basics, SafeMoon is a cryptocurrency that officially launched in March 2021 on the Binance Smart Chain. It drew attention for its promise of rewarding holders and punishing sellers, theoretically making its token more stable. Then, influencers like Lark Davis and War on Rugs took aim at SafeMoon, calling to question its liquidity pool and the nature of its transaction fees. You can read our in-depth coverage of the SafeMoon scam allegations here.
Building on that, SafeMoon requested an audit from CertiK on April 21. For those unfamiliar, CertiK is a blockchain company that conducts security audits of other blockchains, DApps, wallets and smart contracts. According to its SafeMoon report, it evaluated the SafeMoon Smart Contract against different types of attack vectors. It also evaluated the codebase line by line and checked SafeMoon against industry leaders. From there, CertiK pulled together findings that range from critical to informational, and proposed how to address those findings. It will also keep tabs on whether SafeMoon resolves these issues.
So what did the CertiK SafeMoon audit find? Dive in below.
The CertiK SafeMoon Audit Results
- The CertiK audit found a total of 13 issues. This breaks down to 0 critical issues, one major issue, one medium issue, four minor issues and seven informational issues.
- According to the audit, the one major issue has to do with centralized risk in the addLiquidity function.
- CertiK says that over time, the owner address will accumulate a significant portion of the liquidity pool tokens. If the owner is an externally owned account (EOA), CertiK says the entire project could face big consequences.
- One thing to note is that half of the 10% seller fee goes into the liquidity pool as things stand. As CertiK puts it, because the owner address currently stands to accumulate a portion of the liquidity pool, this means that the owner address would be collecting a portion of the forfeit tokens.
- To address this, CertiK recommends restricting management of the liquidity pool tokens. It also recommends improving privileges and roles to make them more decentralized.
- Additionally, CertiK says that SafeMoon could adopt smart contract-based accounts with features like multi-signature wallets. These are wallets that require two or more keys to sign and send transactions.
- CertiK says that SafeMoon could introduce a DAO/governance/voting module to make the process more transparent and less risky.
- In response, SafeMoon says that its founding structure makes it unique from other projects. More specifically, it says that it is less likely to commit a rug-pull scam because of the legal liabilities its founding team faces.
- SafeMoon also says: “We have publicly expressed our goals and intentions of why we will retain custody of the contract. The functions allow additional control for the SafeMoon team to make continued strategic plays in regards to long term growth of the community and the project.”
The Bottom Line
So what else do you need to know?
To start, CertiK did flag 12 other issues in addition to the centralized risk concern. These include everything from typos in the codebase to redundant code. Another noteworthy issue involves the swapAndLiquify function. This function splits a contract balance into two halves. The first is swapped to BinanceCoin (CCC:BNB-USD) via PancakeSwap using the SafeMoon-BNB pair. The BNB balance and the other half of the contract are added to the liquidity pool. According to CertiK, this function currently leaves a BNB balance stuck in the contract without the option for users to withdraw it. CertiK recommends adding a withdraw function or distributing BNB proportionally to holders.
However, SafeMoon says it is choosing to leave the code as is.
The bottom line is that CertiK says its audit is not an endorsement or approval in any way. In fact, in its disclaimer, it says there is always ongoing risk with crypto investments, and it encourages investors to do their own due diligence. SafeMoon announced that the audit was complete on its Twitter, including a 19-second video that featured the phrase “CERTIK APPROVED.”
At the time of writing, SafeMoon prices were up 26%.
On the date of publication, Sarah Smith did not have (either directly or indirectly) any positions in the securities mentioned in this article.
Sarah Smith is the Editor of Today’s Market with InvestorPlace.com.
