- Former SafeMoon CEO John Karony has blamed the company’s missing funds on founder Kyle Nagy
- Karony’s legal team has stated he acted under the belief that Nagy had the authority and control over the project’s wallets
- New filings suggest Karony is seeking to shift responsibility as he faces charges related to wire fraud and securities violations
John Karony, the ex-CEO of crypto token SafeMoon, has pointed the finger at project founder Kyle Nagy for the disappearance of millions in investor funds. As federal prosecutors build their case around alleged fraud, Karony’s defence strategy has begun to emerge—he claims he was misled and manipulated by Nagy, who had sole control over the token’s key assets. With investors still reeling from the token’s collapse, the courtroom blame game has now taken centre stage.
“I Trusted Nagy”
In a recently unsealed court filing, Karony’s legal team argued that he was “unaware of the full scope of Kyle Nagy’s activities” and believed that Nagy “had the authority to manage project funds.” The statement attempts to distance Karony from decisions that led to over $200 million in investor losses, particularly surrounding the alleged misuse of SafeMoon’s liquidity pool—an essential feature meant to stabilise the token’s price.
The U.S. Department of Justice has charged Karony and other SafeMoon executives with conspiracy to commit securities fraud, wire fraud, and money laundering. Prosecutors allege that the team diverted investor funds for personal use, including luxury cars, homes, and personal investments. Karony has pleaded not guilty and is reportedly attempting to portray himself as a victim of Nagy’s deception.
Founder Has Gone to Ground
Kyle Nagy, who has not yet been apprehended by authorities, was charged in absentia. According to investigators, Nagy assured investors that SafeMoon’s liquidity pool was “locked and inaccessible,” but internal communications suggest otherwise. Karony’s legal team now claims that he had no technical access to the wallets in question and relied entirely on Nagy’s representations.
SafeMoon, once promoted by celebrities and influencers, has become a cautionary tale in the crypto world. With flashy promises and viral marketing, it lured in thousands of retail investors—many of whom now feel betrayed. “The whole thing was built on trust,” said one anonymous investor in court filings. “But that trust was misplaced from the start.”
As the trial unfolds, the question remains: was Karony complicit, or simply another victim of the crypto hype cycle and its enigmatic founder?
