Here's the cap doing its job. You invest $25,000 on a SAFE with a $5M cap. The company does well and raises a priced round at a $20M pre-money valuation. Without the cap, your money would convert at that $20M price; with it, you convert as if the company were worth $5M — four times cheaper, so you get four times the shares the new investors get for the same dollar. The cap is the early investor's reward for committing before the company had proof.
Caps usually work alongside a discount, and the investor gets whichever produces the better price. If the round prices below your cap, the discount (commonly 20%) applies instead; if it prices above the cap, the cap wins. A lower cap is better for the investor and more dilutive for the founder, which makes it the key number to negotiate on these instruments. One nuance worth knowing: with a post-money SAFE, the cap is measured against the post-money valuation, which makes your resulting ownership percentage straightforward to calculate at signing. Until a priced round happens, the cap is effectively your stand-in for a valuation.