U.S. prosecutors are seeking a 20-year prison sentence for Celsius founder Alex Mashinsky, calling his actions a calculated fraud that left thousands of customers with billions in losses.
The U.S. Department of Justice is asking a federal judge to sentence Celsius Network founder Alex Mashinsky to 20 years in prison for what it called a “deliberate” fraud that caused billions in customer losses.
In a memo filed on Monday, prosecutors said Mashinsky “refuses to accept responsibility” despite being faced with “overwhelming evidence of guilt, and having pled guilty to the offenses for which he will be sentenced.”
“He has abandoned all pretense of acknowledging his sustained wrongdoing, and he does not even feint at contrition. Instead, he claims he was motivated by a selfless devotion to service, his only mistakes excessive enthusiasm for Celsius and trusting the wrong executives.”
The U.S. Department of Justice
Mashinsky pleaded guilty in December to misleading customers about the safety of their deposits and secretly manipulating Celsius’s CEL token.
Celsius froze the withdrawal of client assets in June 2022. A month later, the company went bankrupt. The crypto lender said it had only $167 million left in its accounts to repat its hands and froze all customer withdrawals to give time to seek more funds.
According to reports, Mashinsky and his wife withdrew an estimated $12 million in crypto from the Celsius Network before the bankruptcy proceedings began. Celsius, launched in 2018, grew to 200 employees and managed around $10 billion in crypto assets by 2021.
More than 200 victim statements were submitted ahead of sentencing, with many calling for a life sentence for Alex Mashinsky. One of them came from Brandon Lawrence, a Celsius investor who said the very essence of cryptocurrency, along with his ambitions and dreams, had been tarnished.
Another victim, retired teacher Stephen Levenberg, said he would accept a three-year sentence for Mashinsky if the stolen funds were returned. Sentencing for Alex Mashinsky is scheduled for May 8 before Judge John G. Koeltl.
