Key Takeaways
- • Alex Mashinsky, former CEO and founder of collapsed Celsius Network, reached a $10 million settlement with the Federal Trade Commission that permanently bans him from working in the cryptocurrency industry.
- • The FTC had secured a $4.7 billion judgment against Mashinsky tied to losses from the Celsius collapse, but the vast majority of that amount is suspended, with only $10 million required to be paid.
- • The suspended judgment can be lifted if the FTC finds Mashinsky failed to disclose a material asset, misstated asset value, or made material misstatements in financial disclosures.
- • The settlement imposes reporting and record-keeping requirements for up to 18 years.
- • Mashinsky is serving a 12-year prison sentence after pleading guilty in December 2024 to commodities fraud and a scheme to manipulate the price of Celsius's CEL token.
Summary
Alex Mashinsky, former CEO and founder of the collapsed crypto lending platform Celsius Network, has reached a $10 million settlement with the Federal Trade Commission (FTC). The agreement permanently restrains him from advertising, marketing, promoting, offering, or distributing any product or service that can be used to deposit, exchange, invest, or withdraw assets, whether directly or through an intermediary, effectively a lifetime ban from the crypto industry, according to the court order.
The FTC had initially obtained a $4.7 billion judgment against Mashinsky tied to losses from the Celsius collapse. Under the settlement, the vast majority of that judgment has been suspended, with only $10 million required to be paid. Per court documents, the suspension can be lifted if the FTC petitions the court and establishes that Mashinsky failed to disclose a material asset, misstated asset value, or made material misstatements in financial disclosures. The settlement order also imposes reporting and record-keeping requirements for up to 18 years.
The settlement follows a broader pattern of heightened regulatory scrutiny of crypto lending platforms. Authorities have pursued both civil and criminal cases against founders of collapsed firms including BlockFi and Genesis, and the FTC action is presented as the latest step in that campaign.
Celsius filed for bankruptcy in 2022 after freezing customer withdrawals, leaving users unable to access billions of dollars in deposits. Mashinsky is currently serving a 12-year prison sentence after pleading guilty in December 2024 to commodities fraud and a scheme to manipulate the price of Celsius's native CEL token. Publisher context also references parallel actions by New York Attorney General Letitia James, which secured up to $35 million and a lifetime crypto ban, and a separate SEC civil fraud action seeking to bar Mashinsky from running an exchange. Samuel Levine, then director of the FTC's Bureau of Consumer Protection, said in July 2023 that "Celsius touted a new business model but engaged in an old-fashioned swindle."
The FTC had initially obtained a $4.7 billion judgment against Mashinsky tied to losses from the Celsius collapse. Under the settlement, the vast majority of that judgment has been suspended, with only $10 million required to be paid. Per court documents, the suspension can be lifted if the FTC petitions the court and establishes that Mashinsky failed to disclose a material asset, misstated asset value, or made material misstatements in financial disclosures. The settlement order also imposes reporting and record-keeping requirements for up to 18 years.
The settlement follows a broader pattern of heightened regulatory scrutiny of crypto lending platforms. Authorities have pursued both civil and criminal cases against founders of collapsed firms including BlockFi and Genesis, and the FTC action is presented as the latest step in that campaign.
Celsius filed for bankruptcy in 2022 after freezing customer withdrawals, leaving users unable to access billions of dollars in deposits. Mashinsky is currently serving a 12-year prison sentence after pleading guilty in December 2024 to commodities fraud and a scheme to manipulate the price of Celsius's native CEL token. Publisher context also references parallel actions by New York Attorney General Letitia James, which secured up to $35 million and a lifetime crypto ban, and a separate SEC civil fraud action seeking to bar Mashinsky from running an exchange. Samuel Levine, then director of the FTC's Bureau of Consumer Protection, said in July 2023 that "Celsius touted a new business model but engaged in an old-fashioned swindle."
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