{"id":9302,"date":"2023-11-03T20:55:21","date_gmt":"2023-11-03T20:55:21","guid":{"rendered":"https:\/\/infundpros.com\/markets\/crypto\/defi-protocol-safemoon-still-running-despite-securities-violations\/"},"modified":"2023-11-03T20:55:23","modified_gmt":"2023-11-03T20:55:23","slug":"defi-protocol-safemoon-still-running-despite-securities-violations","status":"publish","type":"post","link":"https:\/\/infundpros.com\/?p=9302","title":{"rendered":"DeFi Protocol SafeMoon Still Running Despite Securities Violations"},"content":{"rendered":"<div>\n<figure id=\"attachment_127104\" aria-describedby=\"caption-attachment-127104\" style=\"width: 1200px\" class=\"wp-caption aligncenter\"><noscript><\/noscript><figcaption id=\"caption-attachment-127104\" class=\"wp-caption-text\"><em>Source: SafeMoon Website<\/em><\/figcaption><\/figure>\n<p>Decentralized finance (DeFi) protocol SafeMoon has addressed the recent litigation by the United States Securities and Exchange Commission (SEC), expressing its intent to seek a resolution.<\/p>\n<blockquote class=\"twitter-tweet\" data-width=\"550\" data-dnt=\"true\">\n<p lang=\"en\" dir=\"ltr\">We are reviewing the recent news and we of course take these issues extremely seriously. <\/p>\n<p>As we receive more information, we will do our best to address the situation as quickly as possible. <\/p>\n<p>In the meantime\u00a0our teams continue to build and we keep our focus on delivering for\u2026<\/p>\n<p>\u2014 SafeMoon (@safemoon) <a rel=\"nofollow\" href=\"https:\/\/twitter.com\/safemoon\/status\/1720093042290663606?ref_src=twsrc%5Etfw\">November 2, 2023<\/a><\/p>\n<\/blockquote>\n<p>In an official statement posted on X (formerly Twitter), SafeMoon confirmed plans to review the SEC\u2019s charge are in motion. The protocol also emphasized its ongoing commitment to prioritizing user satisfaction and advancing its vision and mission.<\/p>\n<p>While SafeMoon\u2019s dedication to its goals is commendable, the latest investigations from the SEC have substantial merit that could have a negative impact on the platform.<\/p>\n<p>On November 1, the US regulator formally charged the DeFi project\u2019s executives with fraud and for offering unregistered securities.<\/p>\n<p>The individuals named in the charges include Chief Executive Officer (CEO) John Karony, Chief Technology Officer (CTO) Thomas Smith, and the project\u2019s creator, Kyle Nagy.<\/p>\n<blockquote class=\"twitter-tweet\" data-width=\"550\" data-dnt=\"true\">\n<p lang=\"en\" dir=\"ltr\">Today we charged SafeMoon LLC, its creator Kyle Nagy, SafeMoon US LLC, and the companies\u2019 CEO, John Karony, and Chief Technology Officer, Thomas Smith, for perpetrating a massive fraudulent scheme through the unregistered sale of the crypto asset security, SafeMoon.<\/p>\n<p>\u2014 U.S. Securities and Exchange Commission (@SECGov) <a rel=\"nofollow\" href=\"https:\/\/twitter.com\/SECGov\/status\/1719798312608354758?ref_src=twsrc%5Etfw\">November 1, 2023<\/a><\/p>\n<\/blockquote>\n<p>The US regulator stated that unregistered offerings lacked the disclosures and accountability the law demands.<\/p>\n<p>SafeMoon (SFM) debuted in 2021 during the rise of a thriving cryptocurrency market. The project\u2019s team made a commitment to users, assuring them that their staked funds would be securely locked in a liquidity pool (LP).<\/p>\n<p>However, the SEC\u2019s investigation revealed that large portions of the LP were never unlocked but, rather, withdrawn by executives to purchase homes and luxurious cars and fund exotic vacations.\n<\/p>\n<h2>SafeMoon Faces Further Legal Action Amidst Executive\u2019s Arrest<\/h2>\n<p>\nFollowing the SEC\u2019s litigation, the Department of Justice (DOJ) arrested John Karony and Thomas Smith, while Kyle Nagy remains at large.<\/p>\n<blockquote class=\"twitter-tweet\" data-width=\"550\" data-dnt=\"true\">\n<p lang=\"en\" dir=\"ltr\">NEWS: SafeMoon crypto executives arrested by DOJ, charged with fraud by SEC<\/p>\n<p>\u2014 nft now (@nftnow) <a rel=\"nofollow\" href=\"https:\/\/twitter.com\/nftnow\/status\/1719782535541211449?ref_src=twsrc%5Etfw\">November 1, 2023<\/a><\/p>\n<\/blockquote>\n<p>As revealed in the DOJ\u2019s investigation, the executives withdrew over $200 million from the platform, a detail that aligns with the SEC\u2019s filing.<\/p>\n<p>Furthermore, they were found to have misappropriated investor funds for personal gain, similar to the ongoing trial of ex-FTX founder Sam Bankman-Fried and his colleagues.<\/p>\n<p>Breon Peace, the US Attorney of the Eastern District of New York, stated that the defendants deliberately diverted millions of dollars to drive their deceptive scheme and enrich themselves.<\/p>\n<p>They purchased custom-made Porsche sports cars, real estate, and other luxurious cars. However, the defendants denied holding SFM tokens.<\/p>\n<p>The DOJ cited that they repeatedly traded tokens for profit, generated millions, and masked proceeds through private, unhosted wallets and pseudonymous exchange accounts.<\/p>\n<p>Meanwhile, SafeMoon is not new to controversies. On March 28, the platform\u2019s LP was exploited and drained of $8.9 billion worth of tokens.<\/p>\n<blockquote class=\"twitter-tweet\" data-width=\"550\" data-dnt=\"true\">\n<p lang=\"en\" dir=\"ltr\"><a rel=\"nofollow\" href=\"https:\/\/twitter.com\/hashtag\/Safemoon?src=hash&amp;ref_src=twsrc%5Etfw\">#Safemoon<\/a> was just hacked for $8.9M.<\/p>\n<p>After two minutes looking at the newest Safemoon contract, I was able to identify the extremely obvious exploit.<\/p>\n<p>The attacker took advantage of the public burn() function, this function let any user burn tokens from ANY other address (code\u2026 <a rel=\"nofollow\" href=\"https:\/\/t.co\/bovlyVoq1i\">pic.twitter.com\/bovlyVoq1i<\/a><\/p>\n<p>\u2014 DeFi Mark (@MoonMark_) <a rel=\"nofollow\" href=\"https:\/\/twitter.com\/MoonMark_\/status\/1640844732082290688?ref_src=twsrc%5Etfw\">March 28, 2023<\/a><\/p>\n<\/blockquote>\n<p>However, blockchain analysts attributed the attack to a publicly available token burb function in the contract, which allowed attackers to breach security and manipulate the system.<\/p>\n<div class=\"newsletter home-newsletter single\">\n<div class=\"left-side\">\n<p>\n        <em><br \/>\n            Enter your email for our Free Daily Newsletter        <\/em>\n    <\/p>\n<p> A quick 3min read about today&#8217;s crypto news!<\/p>\n<p>    <span class=\"response-msg\" id=\"newsletter-response\"><\/span>\n<\/div>\n<\/p><\/div>\n<\/p><\/div>\n<p><script async src=\"\/\/platform.twitter.com\/widgets.js\" charset=\"utf-8\"><\/script><br \/>\n<br \/>Read the full article <a href=\"https:\/\/cryptonews.com\/news\/defi-protocol-safemoon-still-running-despite-securities-violations.htm\" target=\"_blank\" rel=\"noopener\">here<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Source: SafeMoon Website Decentralized finance (DeFi) protocol SafeMoon has addressed the recent litigation by the United States Securities and Exchange Commission (SEC),&#8230;<\/p>\n","protected":false},"author":1,"featured_media":9303,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[28],"tags":[],"class_list":{"0":"post-9302","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-crypto"},"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v21.3 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>DeFi Protocol SafeMoon Still Running Despite Securities Violations | inFundPros<\/title>\n<meta name=\"description\" content=\"Source: SafeMoon Website Decentralized finance (DeFi) protocol SafeMoon has addressed the recent litigation by the United States Securities and Exchange\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/infundpros.com\/?p=9302\" \/>\n<meta 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