Celsius Network founder pleads guilty to fraud charges over collapse of crypto lending platform

Larry Neumeister

The Associated Press

The founder and former CEO of the failed cryptocurrency lending platform&nbsp;<a href="https://apnews.com/article/cryptocurrency-technology-business-bitcoin-21b37420025d2653a9acbce075b1f7e5">Celsius Network</a>&nbsp;could face decades in prison after pleading guilty Tuesday to federal fraud charges, admitting that he misled customers about the business.<div class="paywall-selector"></div><div class="paywall">



<a href="https://apnews.com/article/cryptocurrency-celsius-mashinsky-arrest-4b4296d01e15d171e51ad5bd94c19c7a">Alexander Mashinsky</a>, 58, of Manhattan, entered the plea in New York federal court to commodities and securities fraud.



He admitted illegally manipulating the price of Celsius’s proprietary crypto token while secretly selling his own tokens at inflated prices to pocket about $48 million before <a href="https://fortune.com/2023/02/07/celsius-network-investigation-red-flags/">Celsius collapsed into bankruptcy in 2022</a>.



In court, he admitted that in 2021 he publicly suggested there was regulatory consent for the company&#8217;s moves because he knew that customers “would find false comfort” with that.



And he said that in 2019, he was selling the crypto tokens even though he told the public that he was not. He said he knew customers would draw false comfort from that too.



“I accept full responsibility for my actions,” Mashinsky said of crimes that stretched from 2018 to 2022 as the company pitched itself to customers as a modern-day bank where they could safely deposit crypto assets and earn interest.



U.S. Attorney Damian Williams said in a release that Mashinsky “orchestrated one of the biggest frauds in the crypto industry” as his company&#8217;s assets purportedly grew to about $25 billion at its peak, making it one of the largest crypto platforms in the world.



He said Mashinsky used catchy slogans like “Unbank Yourself” to entice prospective customers with a pledge that their money would be as safe in crypto accounts as money would be in a bank. Meanwhile, prosecutors said, Mashinsky and co-conspirators used customer deposits to fund market purchases of the Celsius token to prop up its value.



Machinsky made tens of millions of dollars selling his own CEL tokens at artificially high prices, leaving his customers “holding the bag when the company went bankrupt,” Williams said.



An indictment alleged that Mashinsky promoted Celsius through media interviews, his social media accounts and Celsius’ website, along with a weekly “Ask Mashinsky Anything” session broadcast that was posted to Celsius’ website and a <a href="https://fortune.com/company/youtube/" target="_blank">YouTube</a> channel.



Celsius employees from multiple departments who noticed false and misleading statements in the sessions warned Mashinsky, but they were ignored, the indictment said.



A plea agreement Mashinsky made with prosecutors calls for him to be sentenced to up to 30 years in prison and to forfeit over $48 million, which is the amount of money he allegedly made by selling his company&#8217;s token.



Sentencing was scheduled for April 8.</div>

Alexander Mashinsky, 58, of Manhattan, entered the plea in New York federal court to commodities and securities fraud.

Learn more about all things crypto with short, easy-to-read lesson cards. Click here for <a href="https://fortune.com/crypto/crash-course/">Fortune's Crypto Crash Course</a>.

F-Wire

fraud

Companies

Celsius Network founder pleads guilty to fraud charges over collapse of crypto lending platform | Fortune Crypto

Some Fortune Crypto pricing data is provided by Binance.

Catherine McGrath

Dogecoin rebounds 3% as Elon Musk backs down from feud with Trump

/crypto/2025/06/11/dogecoin-rebounds-elon-musk-apologizes-feud-trump/

Crypto software company OneBalance raises $20 million from Cyber Fund and Blockchain Capital

/crypto/2025/06/11/crypto-software-onebalance-funding-20-million-cyberfund-blockchain-capital/

A growing number of Fortune 500 companies are pursuing ‘blockchain initiatives’ as crypto goes mainstream

/crypto/2025/06/10/fortune-500-companies-pursue-blockchain-initiatives-crypto-mainstream/

Alan Suderman

At least 61 firms, from a budget hotel chain to Trump Media, have bought crypto to become ‘bitcoin treasury companies’—’Everyone’s pulling the trigger’

/crypto/2025/06/10/public-firms-budget-hotel-trump-media-crypto-bitcoin-treasury-companies/

Ben Weiss

Exclusive: Stablecoin startup Noah raises $22 million, adds Adyen vet as cofounder

/crypto/2025/06/10/noah-thijn-lamers-stablecoin-startup-shah-ramezani/

BlackRock’s Bitcoin ETF becomes fastest-ever ETF to accumulate $70 billion

/crypto/2025/06/09/blackrock-bitcoin-etf-fastest-70-billion/

Fortune Editors

Fortune Crypto provides smart and timely news about Bitcoin, Ethereum and how startups and big companies are using blockchain to transform finance and investing.

Daily News, Analysis &amp; Price Data on Bitcoin, Ethereum &amp; More

Uncategorized

homepage

Fortune Crypto

NFTs & Culture

Regulators

Latest News, Analysis, Insights &amp; Price Data on Cryptocurrencies

The Coins

Jack Denton

Moses Ndungu

Garbage collectors are turning Africa’s largest slum into one of the world’s most bitcoin-friendly places

https://fortune.com/crypto/2025/06/09/garbage-collectors-africa-largest-slum-worlds-bitcoin-friendly-places/?itm_source=parsely-api

https://fortune.com/crypto/2025/06/11/dogecoin-rebounds-elon-musk-apologizes-feud-trump/?itm_source=parsely-api

https://fortune.com/crypto/2025/06/09/blackrock-bitcoin-etf-fastest-70-billion/?itm_source=parsely-api

https://fortune.com/crypto/2025/06/11/crypto-software-onebalance-funding-20-million-cyberfund-blockchain-capital/?itm_source=parsely-api

https://fortune.com/crypto/2025/06/10/fortune-500-companies-pursue-blockchain-initiatives-crypto-mainstream/?itm_source=parsely-api

https://fortune.com/crypto/2025/06/10/noah-thijn-lamers-stablecoin-startup-shah-ramezani/?itm_source=parsely-api