Celsius Founder Alex Mashinsky Settles With New York for Up to $35 Million, Permanently Barred From Crypto, Securities and Commodities Industries

Celsius founder Alex Mashinsky has been permanently barred from the cryptocurrency, securities and commodities industries under a settlement with New York state.

Cointelegraph reported on October 9 that New York Attorney General Letitia James formally announced the settlement with Mashinsky. The agreement resolves a civil lawsuit filed in 2023 accusing him of falsely promoting Celsius as a safe investment to hundreds of thousands of investors before the company collapsed.

Under the settlement, Mashinsky must pay as much as $35 million under certain conditions. Specifically, he must pay New York $25 million unless he makes an additional $10 million payment on top of assets already forfeited to the federal government. He must also pay another $10 million if he does not complete his prison term.

Mashinsky is currently serving a 12-year federal prison sentence on fraud charges. He pleaded guilty in December 2024 to securities and commodities fraud charges and was separately ordered to forfeit more than $48 million in assets.

In the announcement, James said Mashinsky had promised New Yorkers that Celsius was a safe place to invest their life savings, but left them broke when the company’s reckless bets unraveled.

Before its collapse, Celsius drew about $20 billion in digital assets by offering yields of as much as 17% a year. But it took on increasingly risky investments to maintain those returns, froze customer withdrawals in June 2022 and filed for bankruptcy the following month. At the time, the gap between its assets and liabilities exceeded $1 billion.