{"id":11562,"date":"2025-04-29T12:31:29","date_gmt":"2025-04-29T10:31:29","guid":{"rendered":"https:\/\/wsj-crypto.com\/?p=11562"},"modified":"2025-04-29T12:31:29","modified_gmt":"2025-04-29T10:31:29","slug":"us-doj-seeks-20-year-prison-term-for-celsius-creator-alex-mashinsky","status":"publish","type":"post","link":"https:\/\/wsj-crypto.com\/index.php\/2025\/04\/29\/us-doj-seeks-20-year-prison-term-for-celsius-creator-alex-mashinsky\/","title":{"rendered":"US DOJ Seeks 20-Year Prison Term for Celsius Creator Alex Mashinsky"},"content":{"rendered":"

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Alex Mashinsky, the originator and previous CEO of the now-defunct cryptocurrency lending service Celsius, confronts a 20-year prison term as the US Department of Justice (DOJ) pursues a hefty punishment for his involvement in a multibillion-dollar scam.<\/p>\n

On April 28, the DOJ submitted<\/a> the government\u2019s sentencing brief against Mashinsky, advocating for a 20-year prison sentence due to his deceitful actions, which resulted in billions of dollars lost for Celsius clientele.<\/p>\n

The 97-page document noted that Celsius clients were unable to access roughly $4.7 billion in cryptocurrency after the platform suspended withdrawals<\/a> on June 12, 2022.<\/p>\n

\u201cThe Court must assign Alexander Mashinsky a twenty-year sentence as a fitting punishment for his prolonged series of falsehoods and self-serving actions that resulted in billions in losses and countless customer victims,\u201d stated the DOJ.<\/p>\n

Mashinsky\u2019s individual gain was $48 million<\/h2>\n

Besides the losses faced by investors, the DOJ indicated that Mashinsky personally benefited from the fraudulent activities in which he participated.<\/p>\n

As part of his guilty plea in December 2024<\/a>, Mashinsky acknowledged being the mastermind behind the criminal undertakings at Celsius, resulting in losses exceeding $550 million, and that he personally gained over $48 million, according to the DOJ.<\/p>\n

An excerpt from the government\u2019s sentencing brief against Celsius founder Alex Mashinsky. Source: CourtListener<\/em><\/figcaption><\/figure>\n

The DOJ emphasized that Mashinsky\u2019s guilty admission illustrated that his offenses were \u201cnot the consequence of carelessness, innocence, or misfortune,\u201d but rather stemmed from \u201cintentional, calculated actions to deceive, mislead, and appropriate in the quest for personal wealth.\u201d<\/p>\n

Related: <\/strong><\/em>Prosecutors seek over 6 years prison for Mango Markets exploiter<\/strong><\/em><\/a><\/p>\n

The memorandum was released shortly before Mashinsky\u2019s sentencing hearing, slated for May 8, and will be overseen by US District Judge John Koeltl in the Southern District of New York.<\/p>\n

Earlier, former SEC Chair Jay Clayton, who was appointed as interim US Attorney for Manhattan<\/a> last week, disclosed in an April 23 letter that at least 200 victims submitted statements in the case<\/a> against Mashinsky.<\/p>\n

Other Celsius co-founders<\/h2>\n

While Mashinsky stood out as a pivotal figure in the Celsius fraud, others participated in the extensive cryptocurrency scheme, including Shlomi Daniel Leon, who co-established Celsius with Mashinsky in 2017.<\/p>\n

Previously the chief strategy officer (CSO) of Celsius, Leon resigned in October 2022<\/a>, months following the collapse of Celsius in June.<\/p>\n

\"Cryptocurrencies,
Celsius CSO Shlomi Daniel Leon (left) and Celsius co-founder Alex Mashinsky. Source: Calcalistech<\/em>\u00a0<\/figcaption><\/figure>\n

In July 2023, the Federal Trade Commission accused Leon<\/a>, alongside Mashinsky and another co-founder, Hanoch Goldstein, levying a $4.7 billion penalty against the insolvent lender.<\/p>\n

Magazine: <\/strong><\/em>Bitcoin $100K hopes on hold, SBF\u2019s enigmatic prison shift: Hodler\u2019s Digest, April 20 \u2013 26<\/strong><\/em><\/a><\/p>\n