The Founder and former CEO of Thodex,one of Turkey’s largest crypto exchanges, Faruk Fatih Ozer (29 yrs) has been extradited to Turkey and was detained by police upon his arrival in Istanbul on Thursday on account of charges of fraud and running a criminal organization. More than 400,000 members were left oblivious without access to deposits of $2 billion in cryptocurrencies.
Last year in August, Ozer, who became the subject of international investigation was arrested in Albania after an Interpol red notice was issued against him. Reportedly he fled to Albania after his exchange suddenly went offline in 2022.
Increasingly he shaved his head to avoid identification but fingerprint data and facial recognition helped confirm him as the fraudster. Özer’s Family, brother, sister and four other senior employees were jailed, and at least 83 people were detained as part of the investigation.Earlier this month, Albania’s top court ruled in favor of his extradition, ending his legal battle against deportation.
The events surrounding Thodex created agitation in Turkey where crypto has been used as a safeguard against inflation. Ozer, who once boasted of being a high-school dropout, is now facing charges of managing a criminal organization, aggravated fraud, and money laundering, while the total losses incurred by investors when Thodex collapsed are still unclear, the prosecutor’s initial indictment estimated the losses to be around $24 million,but Turkish media have reported figures as high as $2 billion. According to Chainalysis, the value of cryptocurrency lost at Thodex earlier this year was $2.6 billion, making it the largest “rug pull” of 2021.
There have been various mainstream media articles that describe crypto as a refuge from Turkey’s sky-high inflation and the steep devaluation of the lira.
However such incidents raise questions on how far the nation can go to promote digital currencies in near future.