SafeMoon Files For Ch. 7 Bankruptcy As Legal Woes Continue To Mount, Token Plunges
By Benzinga
Cryptocurrency firm SafeMoon (CRYPTO: SFM) declared Chapter 7 bankruptcy.
The company revealed in its Utah Bankruptcy Court submission that it has liabilities ranging from $100,000 to $500,000.
Additionally, SafeMoon reported holding assets worth $10 million to $50 million, with 50 to 99 creditors.
SafeMoon's leadership stem was arrested last month by U.S. authorities. CEO John Karony, CTO Thomas Smith, and founder Kyle Nagy face charges related to securities fraud conspiracy, wire fraud conspiracy, and money laundering conspiracy.
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These charges are based on accusations of misusing millions of dollars from investors and deceiving customers. While Nagy has been charged, he remains unarrested.
In addition to these charges, SafeMoon is also grappling with a lawsuit from the Securities and Exchange Commission (SEC).
The SEC's lawsuit also alleges the company committed fraud and violated securities laws.
A Chapter 7 bankruptcy typically involves liquidating a debtor's assets to settle debts with creditors. This form of bankruptcy differs from Chapter 11, as it usually signifies a company's intention not to reorganize or restart its operations.
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