Owner of a popular cryptocurrency project stole more than $ 200 million from investors

Thomas Smith, the CTO of the bankrupt SafeMoon DeFi project, pleaded guilty to cryptocurrency fraud that resulted in investors losing more than $ 200 million.

According to documents from the Brooklyn Federal Court, Smith withdrew his previous plea of not guilty and admitted to conspiracy to commit fraud. He misled investors by claiming that SafeMoon’s liquidity pool was locked and inaccessible to the project team, when in fact the funds were withdrawn for personal expenses.

Prosecutors found that Smith, along with CEO Braden Caroni and founder Kyle Nagy, used customer money to buy luxury cars, luxury real estate, and finance personal expenses. Now Smith faces up to 20 years in prison for fraud and up to 25 years for transactions with unregistered securities.

Earlier, in November 2023, the U.S. Securities and Exchange Commission (SEC) filed formal charges against SafeMoon executives for manipulating the SFM token. The investigation showed that they artificially inflated its market capitalization to $ 8 billion, after which the asset sharply lost value, leaving thousands of investors with huge losses.

Smith and Caroni were arrested, and Nagy is still at large. Caroni’s trial is ongoing, with a jury trial scheduled for April 7. This case is yet another example of high-profile cryptocurrency fraud that has attracted the attention of regulators in the United States.