SafeMoon’s proposed $12 million securities settlement has received preliminary approval, clearing a required step toward resolving investor claims against the Chapter 7 debtor. Financialcontent reports that eligible class members include investors who purchased, or were solicited to purchase, SFM tokens directly from SafeMoon between March 8, 2021, and November 1, 2023. Preliminary approval permits the notice and claims process to proceed before final approval.

The trustee’s settlement motion defines the settlement fund as the estate balance remaining after senior claims—then estimated at $12 million—plus qualifying additional recoveries. The class claim is subordinated under section 510(b) to allowed general unsecured claims, with no class distribution until senior claims are paid or fully reserved. The bankruptcy court’s conditional approval order had authorized the trustee to pursue approval in the Utah district court while reserving objections and final bankruptcy approval. The new ruling therefore advances a central distribution framework, but the compromise is not yet effective and class recoveries remain junior to estate creditors.