Alexander Mashinsky, the founder and former CEO of Celsius Network LLC and their affiliated entities, were sentenced to 12 years for committing fraud in fraud and movable values in Celsius.
Alexander Mashinsky said previously guilty of December 3, 2024, before US regional judge John G. Koeltl, who imposed the sentence on Thursday, May 8, 2025.
According to allegations contained in the indictment and statements made in public deposits and in public judicial procedures:
Celsius, a platform for encryption assets, offered customers “rewards” in deposited assets, secured loans and custody services. Marketing itself as the “safest place for your encryption”, Celsius encouraged customers to “remove” themselves by transferring cryptographic assets to its platform. The main bid of the Celsius, the “Earn” program, promised to develop assets to create investment. The Celsius also provided “custody” and “lending” programs, which allow customers to obtain loans by publishing cryptographic assets as collateral. Mashinsky, as CEO, is directly targeted at Celsius to retail customers worldwide. During his term, he repeatedly misleading the basic aspects of the Celsius business and finances to attract customers and maintain their assets. His false allegations have covered the security of activities that create Celsius performance, his profitability, the viability of high interest rates and the dangers associated with the deposition of encryption assets on the platform.
As Mashinsky depicted Celsius as a safe, the platform increased exponentially. By the fall of 2021, Celsius had become one of the world’s largest encryption platforms, holding about $ 25 billion in assets in its climax.
Mashinsky and others orchestrated a time to mislead the customers for the privately owned Cel Celsius token. They handled the price of Cel, spending hundreds of millions that buy it on the open market to artificially inflate its value. At times, they used customer deposits to fund these markets, without revealing it to customers. Without aggressive manipulation, the price of CEL would be significantly lower.
To promote the manipulation system, Mashinsky has repeatedly made false public statements about the activity of the Celsius market and the role in supporting and inflating CEL. In some cases, he and other executives have personally bought CEL to artificially support its value. His inflation of artificial prices allowed him to benefit about $ 48 million from his own CEL sales. He publicly claimed that he was not selling the Cel, while selling really large quantities, sometimes to Celsius himself.
Before Celsius stopped customer withdrawals on June 12, 2022, Mashinsky continued to secure customers of the strong financial position and liquidity of the Celsius. Meanwhile, he withdrew his own assets from the $ 8 million Celsius.
When Celsius announced that it stopped customer withdrawals, hundreds of thousands of Celsius customers had $ 4.7 billion in inaccessible assets on the platform. Celsius went bankrupt on July 13, 2022.
In addition to prison, Mashinsky, 59, of New York, New York, was sentenced to three years of supervised release and ordered to pay a fine of $ 50,000 and a loss of $ 48,393,446.