According to the Department of Justice, Braden Karony, former CEO of the blockchain company SafeMoon, was identified as responsible for a cryptocurrency fraud scheme worth $2 billion. The United States District Court for the Eastern District of New York stated:
"As demonstrated in the trial, the SafeMoon digital asset was anything but safe and turned out to be a mirage for investors deliberately deceived by Karony. Karony used his scheme to buy multiple homes, sports cars, customized trucks, and other luxury items."
This development highlights the inherent risks in the cryptocurrency sector. Recently, Australian authorities shut down more than 90 platforms allegedly related to scams and fraud related to cryptocurrencies.
According to court reports, Karony and his co-defendants defrauded SafeMoon customers and stole their money. According to a 2023 lawsuit, the three were accused of a cryptocurrency fraud scheme that allegedly "diverted and embezzled millions of dollars."
They drained the liquidity funds, which they claimed to have locked. The deputy director in charge of the FBI, Raia, stated: "Braden Karony, CEO of SafeMoon, exploited his company's digital wallet with fictitious success stories and stole millions of dollars in crypto assets to finance luxury purchases."
Although Karony dismissed the accusations against him, his partner, former CTO Thomas Smith, admitted his guilt and testified against him. Meanwhile, another partner, Kyle Nagy, allegedly fled to Russia.
It is worth noting that Karony's trial occurred immediately after the court hearing of former Celsius CEO Alex Mashinsky. During the hearing, the judge imposed a 12-year sentence on Mashinsky.
According to the Department of Justice, the former CEO of SafeMoon used this stolen money to purchase expensive products and properties. Specifically, Karony bought a $2.2 million house in Utah, luxury cars like an Audi R8 and a Tesla, and customized trucks. Chavis, special agent in charge of the IRS-CI in New York, noted:
"Braden Karony deceived investors; he intentionally diverted and embezzled millions in cryptocurrencies for his personal benefit; and filled the entries of his million-dollar homes with luxury cars. Although the name of his company is SafeMoon, this investment was anything but safe; it was just a front for theft."
According to data from CoinMarketCap, the SafeMoon token (SFM) plummeted 10% in a single day following the trial. At the time of this publication, SFM was trading at $0.00001749, a 20% drop in a week and a 50% drop in a month.
Despite this widespread negative trend, the trading volume of the token in 24 hours remains positive, demonstrating investor confidence. The volume currently stands at $427,140, up 10%. While SFM is currently in the red, the positive sentiment surrounding it indicates a potential upward trend.
