SafeMoon CTO Thomas Smith Pleads Guilty To Criminal Charges

Key Takeaways:

SafeMoon CTO Thomas Smith is attempting to reverse his non-guilty plea on criminal charges related the company’s crypto fraud scheme.
Smith and co-defendants Kyle Nagy and Braden John Karony were indicted back in November 2023.
Karony’s trial is slated to begin at the end of the next month.

SafeMoon LLC’s Chief Technology Officer (CTO), Thomas Smith, pleaded guilty to two criminal charges related to the SafeMoon token fraud scheme, according to a court filing on Thursday.

The charges, which include securities fraud conspiracy and wire fraud conspiracy, stem from an investigation into the company’s alleged misappropriation of investor funds.

SafeMoon CTO Thomas Smith Reverses Original Plea

According to reports, Smith agreed to plead guilty to securities fraud conspiracy and wire fraud conspiracy, reversing his 2023 decision to plead not guilty to both charges.

3 years ago we exposed SAFEMOON's fraud.
They told their community it was just "FUD".
Today their CTO Thomas Smith pled guilty. pic.twitter.com/MgUK6R0FcC

— Coffeezilla (@coffeebreak_YT) February 20, 2025

Smith, initially indicted in November 2023 alongside SafeMoon co-founder Kyle Nagy and CEO Braden John Karony, now faces charges of securities fraud conspiracy and wire fraud conspiracy.

The indictment also accused the executives of money laundering.

According to the U.S. Department of Justice, the defendants misled investors by claiming that SafeMoon’s liquidity pools were locked to prevent a “rug pull.”

However, prosecutors say they retained access to the funds and diverted millions of dollars for personal use.

SafeMoon Executives Under Legal Scrutiny for Fraudulent Scheme

Nagy, Karony, and Smith allegedly concealed the origin of misappropriated funds through unhosted crypto wallets, complex transaction routing, and pseudonymous centralized exchange accounts.

Authorities claim the trio used proceeds from the fraudulent scheme to finance extravagant purchases, including luxury cars and real estate.

Smith, in particular, used back-channel transactions to acquire a custom Porsche 911 sports car and a non-fungible token (NFT) using investor funds from the liquidity pool.

“SafeMoon’s executives grew their company value to over $8 billion, but instead of rewarding their clients as promised, their insatiable greed led them to spend millions of dollars on their own lavish desires,” said Ivan J. Arvelo, Special Agent in Charge of HSI, New York.

“Today, no luxury vehicles or sprawling real estate can protect them from the consequences of such crimes,” he added.

Karony is set to stand trial later this month. His request to delay proceedings until April was denied by a judge, despite his argument that evolving U.S. cryptocurrency regulations warranted a postponement.

While Karony awaits trial, the situation surrounding Nagy remains unresolved.

Reports suggest that the former SafeMoon co-founder is in Russia, avoiding legal action.