Celsius leader Mashinsky admits to committing fraud
In a landmark ruling, Alex Mashinsky, the co-founder and former CEO of Celsius, has been sentenced to 12 years in prison for commodities and securities fraud. The sentencing, which took place on May 9, 2025, comes after Mashinsky pleaded guilty to one count each of commodities fraud and securities fraud.
At the height of its operations in 2021, Celsius held approximately $25 billion in assets on its platform. However, customers have only received 60% of the value of their initial losses, according to bankruptcy court documents. The remaining $4.7 billion in crypto, held by customers at the time of bankruptcy, will not be accessible until January 2024.
Mashinsky's fraudulent activities extended to manipulating the price of Celsius' native token, CEL. While secretly selling his own CEL tokens at artificially inflated prices, he lured investors with false promises of low-risk investments. The U.S. Attorney Damian Williams stated that Mashinsky orchestrated one of the biggest frauds in the crypto industry.
In addition to the prison sentence, Mashinsky agreed to forfeit more than $49 million in proceeds from his schemes. The case also involved fraudulent activities that harmed customers, consistent with charges for both securities and commodities fraud.
Roni Cohen-Pavon, the former Chief Revenue Officer of Celsius, was charged with fraud last year and pleaded guilty, agreeing to cooperate with the government's case against Mashinsky. Cohen-Pavon's cooperation may have played a role in the evidence presented during Mashinsky's trial.
It's worth noting that Mashinsky sought witnesses for his trial as recently as August 2025, suggesting ongoing litigation or appeals. The trial was initially scheduled and postponed multiple times, with some jury selection activities moving to July 5, 2025, but the sentencing itself was earlier in May 2025.
The Celsius bankruptcy came in 2022, joining other crypto firms that faced financial collapse. The sentencing of Mashinsky marks a significant step in holding crypto executives accountable for their actions and ensuring transparency in the industry. Other crypto executives have received prison time or supervised release for similar offenses.
The sentencing of Alex Mashinsky, a former crypto executive, has been widely covered in general-news outlets, marking a significant step in the battle against crime-and-justice in the technology domain. Despite his efforts to manipulate the price of Celsius' native token, CEL, and engage in other fraudulent activities, Mashinsky faced charges for both securities and commodities fraud, with his guilty plea leading to a 12-year prison sentence and the forfeiture of over $49 million in crime proceeds.
