It would appear that Smartermail does not provide support for CRAM-MD5 on POP/IMAP/SMTP and only supports Plain-Text Authentication Method.
Although it is true that CRAM-MD5 is far less secure than connections encrypted with TLS, it should be an option available for those without SSL as it is still a better option than Plain-Text without SSL/TLS.
Primarily, the main reason I make this suggestion is that all Apple products (both MacOS and iOS devices) default to CRAM-MD5 ("MD5 Challenge-Response") on all connections (including previously configured accounts) every time there is an update, which generates a huge number of support calls for Smartermail every time a new iOS or MacOS update is released.