The cryptocurrency SafeMoon was down 4.65 percent on the day at around 3:40 a.m. EDT on Wednesday. The drop came as SafeMoon fans were invited to sign up for the beta testing stage of the token’s upcoming SafeMoon Wallet.
At the time of writing, the token was priced at $0.0000045, according to CoinMarketCap. It was unclear why the crypto was down.
The market cap of SafeMoon was at roughly $2.6 billion while the trading volume—a measure of how much of the cryptocurrency was traded in the past 24 hours—was down 20 percent to $17.9 million. All of these figures are likely to change.
Users must agree to sign a non-disclosure agreement (NDA) in order to participate. It is unclear what the terms of the NDA are.
An NDA is a legally binding contract that establishes confidentiality between the parties involved. People signing on generally agree that they will not share any sensitive information that they may obtain that is relevant to the NDA.
In the world of business, it is common for NDAs to be signed between businesses if they enter into a deal or venture with one another. In such a case, an NDA could allow the businesses to share information with each other without fear it will end up with competitors.
According to Investopedia, essential parts of an NDA include a definition of what constitutes confidential information; any exceptions; and the time periods involved.
The release of the form prompted a number of posts on the SafeMoon Reddit page as users urged others to abide by the NDA’s terms, if they are chosen to test the wallet.
“There might be some serious penalties for violating the NDA,” one user wrote in a thread. “I highly recommend people who sign the NDA take it seriously and abide by it.”
Another said people should not reveal whether they get selected to participate in the beta test at all in case they become a target, without stating why.
Newsweek has contacted SafeMoon for comment.
SafeMoon is a new token that launched in March this year. Experts have warned Newsweek about the risks associated with cryptocurrency trading, including the volatile prices of tokens that can fluctuate rapidly.
Lark Davis, a crypto investor and blogger, told Newsweek in May that many new coins in 2021 “are riding on hype alone from inexperienced retail traders.”
And Chester Spatt, a professor of finance at Carnegie Mellon University’s Tepper School of Business, told Newsweek recently that people should “be very cautious about new tokens.”
He said: “People should not be investing funds in these that they cannot afford to lose completely.”