New York Attorney General Letitia James secures a settlement permanently barring former Celsius Network CEO Alex Mashinsky from the securities, commodities, and cryptocurrency industries. The agreement includes up to $35 million in conditional payments, which Mashinsky must pay if he fails to forfeit $10 million to the federal government or fails to serve his full 12-year federal prison sentence for fraud. Meanwhile, Celsius bankruptcy proceedings have distributed over $3.4 billion to creditors.
Terms of the New York settlement
- ▪Alex Mashinsky must pay New York an additional $10 million under his October 9, 2026, settlement with New York Attorney General Letitia James if he fails to serve his full federal prison sentence
- ▪New York Attorney General Letitia James announced a settlement on October 9, 2026, that permanently bars former Celsius Network CEO Alex Mashinsky from the financial, securities, commodities, and cryptocurrency industries in New York
- ▪A settlement with New York Attorney General Letitia James secures up to $35 million in conditional payments, requiring Alex Mashinsky to pay New York $25 million if he fails to forfeit $10 million in gains to the federal government
New York lawsuit and investigation
- ▪The New York Attorney General's investigation found that Alex Mashinsky falsely promoted Celsius Network as safer than a bank while deploying customer assets in high-risk strategies and concealing the resulting losses
- ▪New York Attorney General Letitia James sued Alex Mashinsky in January 2023, accusing him of defrauding hundreds of thousands of investors, including over 26,000 New York residents
Federal criminal case
- ▪Alex Mashinsky was ordered to forfeit $48,393,446 in his parallel federal criminal case and has petitioned a court to vacate his 12-year prison sentence
- ▪Alex Mashinsky is serving a 12-year federal prison sentence after pleading guilty on December 3, 2024, to federal charges of securities fraud and commodities fraud
Other federal regulatory settlements
- ▪The Federal Trade Commission reached a settlement with Alex Mashinsky in April 2026 that included a suspended $4.7 billion judgment, a $10 million payment, and an 18-year reporting requirement
- ▪The Commodity Futures Trading Commission resolved its case against Alex Mashinsky in June 2026 with a consent order imposing permanent trading and registration bans
Celsius Network bankruptcy
- ▪Celsius Network creditors and customers have received more than $3.4 billion through the company's bankruptcy proceedings as of August 2026
- ▪Celsius Network froze customer withdrawals in June 2022 and filed for bankruptcy protection a month later
Debatable claims
- ▪Conditioning state civil penalties on the completion of federal prison sentences is an inappropriate enforcement tool
- ▪Crypto lending platforms should be subject to the same regulatory standards as traditional banks
- ▪New York's settlement with Alex Mashinsky is a redundant duplication of federal enforcement
- ▪Lifetime industry bans are an effective deterrent against cryptocurrency fraud
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