Thodex CEO's Prison Death Sparks Urgent Calls for Crypto Regulation After $2.6B Losses

Faruk Fatih Özer, the former chief executive of the now-defunct Turkish cryptocurrency exchange Thodex, was found dead in his prison cell in Tekirdağ on November 1, 2025, according to a Bloomberg report. Authorities are investigating the possibility that Özer, who was serving an 11,196-year prison sentence for orchestrating one of Turkey's largest financial frauds, took his own life. The incident has reignited scrutiny over the collapse of Thodex, which in 2021 left thousands of investors with losses estimated at $2.6 billion by blockchain analytics firm Chainalysis.

Özer, a self-made entrepreneur who founded Thodex in 2017, fled to Albania after the exchange abruptly shut down in April 2021, leaving users unable to access their funds. He was extradited to Turkey in August 2022 and later convicted on charges including establishing a criminal organization, aggravated fraud, and money laundering. The 9th High Criminal Court of Anadolu sentenced him in September 2023 to the unprecedented 11,196-year term, a figure calculated by stacking penalties for multiple counts of fraud and asset laundering, as noted in a CryptoBriefing report. His siblings and senior executives were also sentenced to lengthy terms, while 16 defendants were acquitted due to insufficient evidence, according to a Türkiye Today report.

The Thodex scandal, which prosecutors described as one of Turkey's largest cryptocurrency-related frauds, involved the alleged misappropriation of $253.71 million in crypto assets and $356 million in damages to investors, as reported by Türkiye Today. Özer's indictment detailed how the platform operated as a facade for fraudulent transactions, with funds siphoned into wallets controlled by him and his associates. Despite the scale of the case, the prosecution's initial estimate of losses at $24 million starkly contrasted with media and Chainalysis reports, highlighting the lack of transparency in the investigation — a discrepancy previously detailed by Bloomberg.

Özer's death has raised questions about investor protections in the volatile crypto sector. The collapse of Thodex exposed the risks of unregulated exchanges, prompting calls for stricter oversight in Turkey and beyond. While the government has since introduced measures to regulate crypto transactions, the case remains a cautionary tale for investors navigating the fast-moving digital asset landscape.

An investigation into Özer's death is ongoing, with authorities focusing on whether suicide was the cause. His death in custody has also drawn attention to prison conditions and the mental health of inmates serving extreme sentences. The case underscores the complex interplay of financial crime, regulatory challenges, and the human toll of digital finance's uncharted territory, a theme explored in the CryptoBriefing analysis.