MoonSafe Code Audit Shows Suspicious Anomalies, Scam Confirmed?

DeFi liquidity project MoonSafe is caught in a sea of controversy at present. Not only do prominent crypto personalities allege the project is a scam, but an analysis of its code by Obelisk reveals misleading claims about how liquidity provider (LP) tokens are secured.

LP tokens are minted and sent to the liquidity provider’s address as evidence of providing liquidity. They have utility and value and are often used to yield farm and therefore multiply gains from the initial act of providing liquidity. However, according to research by Obelisk, MoonSafe LP tokens are accessible by the founders.

“One of the main issues with the whole project is that while users are lead to believe that the Liquidity Provider tokens (essentially the receipt for having provided liquidity) are in fact locked and inaccessible from the founders, the exact opposite happens.”

Suspicions Over MoonSafe Heighten

MoonSafe gains since its inception hit 11,500% at its peak. But a series of events have since tanked its price. The primary concern relates to allegations that the project is a rug pull, only to line the founders’ pockets.

SafeMoon price chart

Source: MOONSAFEUSD on coingecko.com

A whitepaper review highlights several inconsistencies, such as vague statements on the lock and burn process and other red flags, including a roadmap that doesn’t go beyond 2021.

“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.”

Obelisk audited the MoonSafe code, which revealed more reasons to be wary. They allege fees for providing liquidity are directed to a wallet controlled by the developer. To address this, Obelisk recommends included an additional step to divert those funds to a smart contract with predefined community-centric functions.

“To mitigate risks, SafeMoon ownership could be transferred to a smart contract that could be programmed to handle…

Read More