SafeMoon Scandal Ends With 8-Year Sentence for Ex-CEO

The former CEO of SafeMoon, Braden Karony, was sentenced to 8 years for fraud involving $9 million in misappropriation.

Braden John Karony, the former CEO of SafeMoon, has been sentenced to 8 years in prison for his role in a multi-million dollar crypto fraud scheme.

US District Judge Eric Komite issued the ruling in federal court in Brooklyn after a jury convicted him in May 2025 following a three-week trial.

Details of Sentence

Court documents show that Karony was found guilty of conspiracy to commit fraud, embezzlement and money laundering. As part of the decision, he was ordered to pay approximately $7.5 million in restitution, with the amount of restitution to be determined at a later date. The judge also issued a decision ordering the confiscation of two residential buildings.

Meanwhile, one of his co-conspirators, Thomas Smith, pleaded guilty in February 2025 and is awaiting sentencing, while Kyle Nagy remains at large.

“Karony lied to investors from all walks of life—including military veterans and hard-working Americans—and defrauded thousands of victims to buy mansions, sports cars and luxury trucks,” said United States Attorney Joseph Nocella, Jr.

FBI Assistant Director James C. Barnacle said the former official abused his position and betrayed the trust of investors by stealing more than $9 million in cryptocurrencies to fund a lavish lifestyle. The proceeds were used to purchase luxury cars and homes, including a $2.2 million home in Utah, additional homes in Kansas, a $277,000 Audi R8 sports car, a Tesla, a custom Ford F-550, and Jeep Gladiator trucks.

IRS-CI New York Special Agent in Charge Harry T. Chavis added that Karony carried out the scheme by exploiting his access to SafeMoon’s liquidity pool while trying to hide the transactions, which were eventually pursued by law enforcement, exposing the scheme.

Liquidity Pool Errors

SafeMoon tokens were launched in March 2021 by the company on the public blockchain, and each transaction is subject to a 10% tax divided into two 5%. One was intended to be shown to owners in proportion to their assets, increasing the balance of their tokens, while the remaining 5% was reserved for their pools to increase liquidity in the markets.

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In the months following its release, SafeMoon attracted millions of customers and reached a market capitalization of over $8 billion.

Prosecutors said Karony and his colleagues lied about important information about the company, including false statements that its reserves were locked and could not be used for personal reasons, that the tokens would be used only for certain business purposes, that pairs of digital assets would be added to the liquidity pool manually when trades took place on a particular exchange, and that the developers were not using or trading their SafeMoon for profit.

In fact, they have kept access to spending pools and diverted millions of dollars of crypto to enrich themselves.