A federal jury within the Japanese District of New York convicted former SafeMoon CEO Braden Karony on Could 21 of conspiracy to commit securities fraud, wire fraud and cash laundering after a 12-day trial that started on Could 5.
He now faces as much as 45 years in jail and the forfeiture of illicit positive aspects.
Prosecutors detailed how Karony and his co-conspirators misled traders concerning the SafeMoon token design, falsely claiming that its liquidity swimming pools have been “locked” by a ten% transaction tax, that insiders couldn’t carry out a “rug pull,” and that tokens would serve solely enterprise functions slightly than private enrichment.
Additionally they assured consumers that builders didn’t maintain or commerce SFM tokens, and that the group would manually add token pairs to the pool when trades occurred on main exchanges.
(1/3) “As confirmed at trial, the SafeMoon digital asset was something however secure and turned out to be pie within the sky for traders who have been intentionally misled by Karony, a person who sought to get wealthy fast by stealing and diverting tens of millions of {dollars},” acknowledged U.S. Legal professional Nocella.
— US Legal professional EDNY (@EDNYnews) Could 21, 2025
In actuality, the defendants retained full entry to the liquidity swimming pools. Consequently, they diverted tens of millions of {dollars}’ value of SFM tokens for their very own revenue.
$2.2M Utah Dwelling Amongst Property Purchased with Fraud Proceeds
Prosecutors say the defendants repeatedly purchased and offered tokens at market peaks. Furthermore, they routed proceeds via non-public wallets and pseudonymous accounts.
In consequence, Karony alone netted over $9m. He used these funds to purchase a $2.2m dwelling in Utah and extra properties in Utah and Kansas. He additionally bought a $277,000 Audi R8, one other Audi R8, a Tesla, and customized Ford F-550 and Jeep Gladiator vehicles.
Co-defendant Thomas Smith testified towards Karony after pleading responsible and will obtain a lighter sentence, whereas platform creator Kyle Nagy reportedly fled to Russia and stays at giant. The jury additionally ordered forfeiture of 1 residential property and the proceeds from one other, totalling about $2m.
‘Pie within the Sky’ Ruling Highlights Investor Betrayal
The Justice Division’s enterprise and securities fraud part is dealing with the case. Moreover, Assistant US Attorneys Dana Rehnquist, Sara Winik and Jessica Weigel are main the prosecution. In the meantime, Assistant US Legal professional Laura Mantell is overseeing forfeiture issues. They’re supported by paralegal specialists Asher Martin-Rosenthal and Madison Bates.
“At trial, we proved that the SafeMoon digital asset was something however secure and turned out to be pie within the sky for traders,” stated US Legal professional Jaqueline Romero Nocella. “Karony used his scheme to buy houses, sports activities automobiles, customized vehicles, and different luxurious items. This verdict ought to warn fraudsters that we are going to vigorously prosecute those that prey on digital-asset traders.”
Karony’s trial adopted the January sentencing of former Celsius CEO Alex Mashinsky to 12 years in jail after a responsible plea, and the 25-year time period handed to former FTX chief Sam Bankman-Fried in 2023.
These circumstances, alongside Wednesday’s verdict, level to the Justice Division’s intensified give attention to digital asset markets and sign that executives who breach investor belief will face extreme penalties.
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