Former SafeMoon CTO Thomas 'Papa' Smith testified in a New York courtroom, revealing mechanisms that allowed insiders to siphon funds from investors in 2021.
Testimony of Former CTO
Thomas Smith, who has already pleaded guilty, testified against John Karony, former CEO of SafeMoon, and its co-founder Kyle Nagy. Smith indicated that the project was built to allow the misappropriation of investor funds.
Funds from Liquidity Pools
Smith admitted that the SafeMoon code allowed the core team to pull millions from liquidity pools, despite claims that the pools were locked for investors. He emphasized that this was essentially a built-in deception.
Hidden Mechanisms
Smith also disclosed a hidden tool called 'exclude from tax', which allowed insiders to skip the 10% transaction fee. According to him, this feature was only available to those who controlled the main wallet of the project.
Court proceedings continue, with Smith's testimony raising significant questions about fraud in the cryptocurrency space and investor trust in such projects.
