Former SafeMoon CEO Braden Karony sentenced to eight years for fraud tied to $9 million in misused liquidity funds.
Braden John Karony, SafeMoon’s former CEO, has been sentenced to eight years in jail for his function in a multi-million greenback crypto fraud scheme.
US District Choose Eric Komite handed out the judgment in a Brooklyn federal court docket after a jury convicted him in Could 2025 following a three-week trial.
Particulars of The Sentencing
Courtroom paperwork show that Karony was discovered responsible of conspiracy to commit securities fraud, wire fraud, and cash laundering. As a part of the ruling, he has been ordered to forfeit roughly $7.5 million, whereas the quantity of restitution to victims will likely be decided at a later date. The jury additionally issued a verdict instructing the forfeiture of two residential properties.
In the meantime, considered one of his co-conspirators, Thomas Smith, pleaded responsible in February 2025 and is awaiting sentencing, whereas Kyle Nagy stays at massive.
“Karony lied to buyers from all walks of life—together with navy veterans and hard-working People—and defrauded 1000’s of victims so as to purchase mansions, sports activities vehicles, and customized vehicles,” stated United States Lawyer Joseph Nocella, Jr.
FBI Assistant Director in Cost James C. Barnacle stated the previous govt abused his place and betrayed buyers’ belief by stealing greater than $9 million in cryptocurrency to finance a lavish life-style. The proceeds have been used to buy luxurious automobiles and actual property, together with a $2.2 million dwelling in Utah, extra properties in Kansas, a $277,000 Audi R8 sports activities automobile, a Tesla, a customized Ford F-550, and Jeep Gladiator pickup vehicles.
IRS-CI New York Particular Agent in Cost Harry T. Chavis added that Karony carried out the scheme by exploiting his entry to SafeMoon’s liquidity pool whereas making an attempt to hide the transactions, which legislation enforcement finally traced, exposing the scheme.
Liquidity Pool Misrepresentations
SafeMoon tokens have been launched in March 2021 by the agency on a public blockchain, with every transaction robotically topic to a ten% tax that was cut up into two 5% tranches. One was meant to be mirrored to holders in proportion to their holdings, rising their token balances, whereas the remaining 5% was designated for its swimming pools to spice up market liquidity.
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Within the months following its debut, SafeMoon attracted thousands and thousands of shoppers and reached a market capitalization exceeding $8 billion.
Prosecutors declare that Karony and his companions lied about necessary particulars of the corporate, together with false statements that its reserves have been locked and couldn’t be used for private causes, that tokens would solely be used for particular enterprise functions, that digital asset pairs could be added to the liquidity pool manually when trades occurred on sure exchanges, and that the builders weren’t utilizing or buying and selling SafeMoon for their very own achieve.
In actuality, they retained entry to the liquidity swimming pools and diverted thousands and thousands of {dollars}’ value of crypto for private enrichment.
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