Following the unlocking of its tokens, the price of Safe (SAFE) tokens experienced a significant decline of 42%, dropping from $3.26 to $1.88 on April 30.
Safe’s token contract was unpaused on April 23, allowing holders to transfer their tokens. These tokens had been locked for two years since the decentralized autonomous organization (DAO) of the project decided to implement the lock in 2022.
The token transferability proposal put forth by SafeDAO received overwhelming support, with 99.1% of participants voting in favor.
A spokesperson for Safe informed Cointelegraph that the DAO deliberately postponed the release of the tokens to facilitate progressive decentralization. The DAO worked collaboratively on a roadmap that addressed various aspects such as governance processes and resource allocation. This approach ensured the maturity of these areas before unlocking the tokens.
The spokesperson emphasized that the proposal for token transferability was only formulated after achieving the milestones set by the DAO. They stated:
“Despite the absence of token transferability and the challenging period for cryptocurrencies, Safe witnessed a remarkable growth in its user base, expanding by 22 times. Additionally, our team managed to secure $100 billion in assets and witnessed the creation of 7.5 million accounts.”
However, even with this impressive growth, the token’s price experienced a substantial decline once token transferability was enabled.
According to CoinGecko, a coin information website, Safe was being traded at $3.26 on April 23. As of now, the token is valued at $1.88, representing a 42% decrease since the initiation of transfers.
In light of enabling token transferability, the spokesperson for Safe stated that the project aims to establish the internet’s ownership layer, empowering users to have control over their data, identity, and assets within the Web3 space.
To achieve this, Safe plans to implement native integration for layer 2s to enhance scalability and cross-chain functionality through network abstraction. Furthermore, the project intends to organize community activities to foster its ecosystem.