Former Celsius Network CEO Alexander Mashinsky Faces Recommended Sentence of at Least 20 Years in Prison

Alexander Mashinsky, who founded Celsius in 2018, built the platform into a major name in the world of cryptocurrency. He promoted Celsius as a safe alternative to traditional banks

Former Celsius Network CEO Alexander Mashinsky is facing a recommended sentence of at least 20 years in prison for leading what prosecutors describe as a years-long fraud that caused billions of dollars in losses and devastated thousands of everyday investors.

According to a report by Law360, prosecutors included the recommendation in a sentencing memo filed on Monday ahead of Mashinsky’s sentencing hearing next month. Mashinsky, 57, is set to be sentenced by a federal judge in New York on November 13.

The former CEO is set to be sentenced after pleading guilty in December to two criminal counts: lying about the safety of Celsius’s investment platform and manipulating the price of CEL for personal gain. He admitted to personally profiting over $48 million from the schemes, while total losses exceeded $550 million.

However, despite the plea, prosecutors say Mashinsky still refuses to fully accept responsibility. They accuse him of trying to shift blame to others, including market conditions and even his victims, and of shielding assets through family-controlled trusts.

“The sentence imposed should be sufficiently severe to punish Mashinsky for his crimes and deter others from engaging in similar conduct in the future,” government attorneys wrote in the memo.

According to the report, prosecutors also argued that a long sentence is necessary to send a clear message to others in the crypto industry. They said that Mashinsky’s crimes were “serious” and that he had shown “no remorse.”

Mashinsky founded Celsius in 2018 with the aim of providing a decentralized platform for cryptocurrency investors to earn interest on their holdings, touting it as a safe alternative to traditional banks.

However, according to prosecutors, Mashinsky misled customers about how their money was being handled, used risky investment strategies behind their backs, and lied about Celsius’s financial health. He also used customer funds to manipulate the price of the company’s own CEL token, secretly selling his personal stash of tokens for tens of millions of dollars.

After Celsius went bankrupt in 2022, thousands of investors lost their savings. Many were ordinary people who had entrusted their assets to Celsius in good faith, only to see their hopes for retirement, their children’s college funds, and their family inheritances destroyed by Mashinsky’s fraud, the government attorneys said.

The crimes had a devastating impact on the victims, many of whom lost their life savings and were now in dire straits, the memo said.

“The sentence imposed should reflect the enormity of Mashinsky’s crimes and provide just punishment for his actions,” the prosecutors concluded.