SafeMoon Founder Sentenced to 100 Months in Prison for Crypto Fraud Scheme

Braden John Karony, the former chief executive officer of SafeMoon, received a 100-month federal prison sentence for orchestrating a cryptocurrency fraud scheme that targeted thousands of investors. A jury previously convicted him on charges of securities fraud, wire fraud, and money laundering after evidence showed he diverted millions from funds advertised as safely locked. U.S. District Judge Eric Komitee imposed the term in Brooklyn federal court, balancing victim impact statements against defense arguments about Karony's personal history.

Prosecutors detailed how Karony personally withdrew more than $9 million in cryptocurrency from wallets he claimed were inaccessible to the team. He used portions of those assets for luxury purchases and coordinated trading activity to artificially inflate the price of the SafeMoon (SFM) token. Investors who testified at the hearing described severe financial losses after believing the project's assurances that their money was protected in liquidity pools.

The court also ordered Karony to forfeit approximately $7.5 million as part of the judgment, with restitution amounts to be determined later. This outcome follows a trial that exposed systematic misuse of investor capital under the banner division of decentralized finance. The case has drawn attention as one of the highest-profile criminal prosecutions tied to a meme-inspired token.

Rise and Collapse of the SafeMoon Project

SafeMoon launched in early 2021 on the BNB Chain, quickly attracting attention with its community-focused model and a 10% fee on every transaction. The design redistributed part of each fee to existing holders while directing another portion to liquidity, creating buzz that propelled the token to a multi-billion-dollar market cap within months. Influencer promotions and social media momentum fueled rapid growth during a broader crypto bull market.

Behind the public messaging, however, executives maintained undisclosed control over key wallets and siphoned assets for private gain. Federal authorities charged Karony and others in November 2023, alleging the team misled the community about the security of invested funds. SafeMoon filed for Chapter 7 bankruptcy shortly afterward, rendering the token effectively illiquid and wiping out remaining value for many holders.

Thomas Smith, SafeMoon's former chief technology officer, pleaded guilty last year to related conspiracy charges and corroborated claims that liquidity-pool assets were diverted. His cooperation highlighted how project leaders exploited investor enthusiasm while privately treating funds as personal resources. The collapse left a trail of financial hardship and eroded confidence in similar high-yield DeFi offerings.