Founder of Bankrupt Crypto Lending Platform Celsius Network Pleads Guilty to Fraud Charges

The founder and former CEO of the collapsed cryptocurrency lending platform Celsius Network, Alexander Mashinsky, 58, pleaded guilty to federal fraud charges on Tuesday, admitting to misleading customers about the business, and he faces decades in prison. He accepted charges of commodities and securities fraud in a New York federal court. Mashinsky acknowledged that he illegally manipulated the price of Celsius's proprietary cryptocurrency token and secretly sold his own tokens at inflated prices, pocketing approximately $48 million before Celsius filed for bankruptcy in 2022. In court, he confessed to publicly stating in 2021 that there was regulatory approval for the company’s moves because he knew customers would find "false comfort" in it. He admitted to selling cryptocurrency tokens despite claiming he did not sell to the public in 2019, acknowledging that he was aware customers would also feel a false sense of security from this. Accepting "full responsibility for my actions" for crimes committed between 2018 and 2022, Mashinsky stated that the company presented itself as a modern bank where customers could safely deposit their crypto assets and earn interest. U.S. Attorney Damian Williams remarked that Mashinsky orchestrated "one of the largest frauds in the crypto industry," with his company's assets reaching nearly $25 billion at its peak, making it one of the largest crypto platforms in the world.