Former SafeMoon CEO Braden Karony sentenced to eight years for fraud involving $9 million in misused liquidity funds.
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.
U.S. District Judge Eric Komite handed down the sentence in a federal court in Brooklyn after a jury convicted him in May 2025 following a three-week trial.
Details of the conviction
Court documents show that Karony was found guilty of conspiracy to commit securities fraud, bank fraud and money laundering. As part of the ruling, he was ordered to forfeit approximately $7.5 million, with the amount of restitution to the victims to be determined at a later date. The jury also returned a verdict ordering the forfeiture of two properties.
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 into purchasing mansions, sports cars and custom trucks,” said United States Attorney Joseph Nocella, Jr.
FBI Deputy Director James C. Barnacle said the former director abused his position and betrayed investors’ trust by stealing more than $9 million in cryptocurrency to fund a lavish lifestyle. The proceeds were used to purchase luxury vehicles and real estate, 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 pickup trucks.
IRS-CI New York Special Agent in Charge Harry T. Chavis added that Karony carried out the scheme by using his access to SafeMoon’s liquidity pool while attempting to conceal the transactions, which law enforcement was eventually able to trace, exposing the scheme.
Misrepresentations of the liquidity pool
SafeMoon tokens were launched by the company on a public blockchain in March 2021, with each transaction automatically subject to a 10% tax that was split into two 5% tranches. One of them was intended to be reflected to holders in proportion to their holdings, increasing their token balances, while the remaining 5% was intended for the pools to increase market liquidity.
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In the months after its debut, SafeMoon attracted millions of customers and reached a market capitalization of more than $8 billion.
Prosecutors allege that Karony and his partners lied about key details of the company, including false statements that reserves were frozen and could not be used for personal reasons, that tokens would only be used for specific business purposes, that digital asset pairs would be manually added to the liquidity pool when trading on certain exchanges, and that the developers did not use or trade SafeMoon for their own gain.
In reality, they retained access to the liquidity pools and used millions of dollars in cryptocurrencies for personal enrichment.
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