The head of a crypto exchange made off with his clients’ savings in 2021. After his arrest in Albania, he has now been sentenced.
Cryptocurrencies are controversial. One of the best-known exchanges for cryptocurrencies, Thodex, collapsed in 2021, and the head of the exchange disappeared without a trace, with 2.5 billion USD (2.3 billion euros).
The head of the exchange has now been sentenced to 11,196 years in prison. The public prosecutor’s office had demanded more than 40,000 years for each individual employee of the company.
Our title image is taken from the YouTube channel TRT Haber. This features the arrested head of Thodex.
Crypto exchange was seen by users as a safe alternative to real money
What was Thodex? Thodex was founded in 2017 and had success during a time when Turkey’s state currency, the lira, was experiencing rapid inflation. The Turkish population began to view cryptocurrencies as a seemingly safer option compared to the volatile lira and invested their savings there.
In 2021, there was supposed to have been a major crash: The funds of the owners were frozen, the head still claimed that everything was safe, and then disappeared without a trace. In September 2022, the police apprehended him in Albania.
The analysts from “Chainanalysis” (via chainanalysis.com) stated in a comprehensive report: Thodex was apparently from the very beginning a sinister tactic, a so-called “Rug Pull”:
- A seemingly legitimate company is founded.
- The company operates for a time like a normal business and builds trust with its customers. These then invest their money in the company.
- After a sudden “crash”, all the money suddenly disappears.
- Thodex is said to have been exactly such a scam. According to analysts, numerous scams in recent years are linked to Thodex.
How much money really disappeared in the end is controversial: Prosecutors mention a sum of approximately 43 million euros. Experts, however, estimate the sum at 2 billion euros.
In Turkey, long prison sentences instead of the death penalty
Why are the prison sentences so high? The Turkish public prosecutor’s office had then demanded 40,564 years in prison for the head and his 20 colleagues each. Now he and his siblings are getting away with “only” 11,196 years in prison. He himself stated in court, according to a Turkish news agency:
I am smart enough to lead any institution in the world. This is evidenced by the company I founded at the age of 22. If this were a criminal organization, I would not have acted so ineptly.
Since the abolition of the death penalty in Turkey in 2004, such long prison sentences are not unusual. However, colleagues from PCGamer joke that the head of the exchange could at least somewhat mitigate the long sentence with good behavior: Then he would be free again after 4,000 to 6,000 years.
More on crypto banks: Crypto banks and large exchanges are said to manage large sums for their users repeatedly. However, it often goes wrong. Recently, a large company declared bankruptcy. This involves billions of euros managed by this company. Many users wonder if they will ever see their money again:
Crypto bank missing 1 billion euros and closing – “I managed to ruin my life”
