The fallen giant of Turkey’s cryptocurrency landscape, Thodex, and its founder Faruk Fatih Ozer are back in the headlines. The once-praised CEO, now branded a criminal fugitive, faced a Turkish court and received a staggering 11,196-year prison sentence on various charges including fraud, leadership of a criminal organization, and money laundering, as per a recent Bloomberg report. To add to the misery, two of Ozer’s siblings also shared a similar fate for their involvement in Thodex-related misdeeds.
The Thodex story is a tale of heights and abyss. Once a glowing beacon on the cryptocurrency horizon, with trading services to over 400,000 users, the exchange abruptly terminated operations in April 2021. The shock and chaos that resulted from this sudden action cast a pall of uncertainty over the investors’ assets. Ozer, at the heart of this precarious situation, vanished, allegedly seeking sanctuary in Albania, leaving behind a trail of financial despair.
The colossal “rug pull,” as critics label it, shook the crypto-enthusiast community, invoking immediate action by Turkish law enforcement agencies. An initial sweep heaved 62 individuals into custody with ongoing investigations unveiling worrisome facts.
The initial damage assessment gave unsettling figures of around $24 million in losses. However, an analysis by blockchain firm Chainalysis showed an even more distressing panorama. They pushed the financial hit to an unfathomable $2.52 billion, accounting for 90% of the total value lost worldwide to comparable fraudulent schemes in 2021.
Eventually, the Turkish mole had to rise from the shadows. In August 2022, Ozer was captured in Albania, concluding an elongated legal drama with extradition back to Turkey.
The repercussions of the Thodex calamity continue to guide regulatory policies in Turkey’s crypto market. Despite the appeal of the blockchain-based infrastructure, especially amidst rampant inflation and the Turkish lira’s devaluation, the Thodex fallout served a cautionary tale for many abruptly divorced from their crypto hopes. The actual toll of investor losses in this unparalleled criminal event remains, in part, a data fog and, in full, a bleak reminder of the perilous waters of the crypto manifest.
Source: Cryptonews
