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Home » Alex Mashinsky, former CEO of Celsius, arrested and charged with fraud

Alex Mashinsky, former CEO of Celsius, arrested and charged with fraud

Important facts:
  • According to the US lawsuit, Mashinsky orchestrated a plan to defraud Celsius customers.

  • The price of the Celsius token fell by 5%.

The former CEO of Bitcoin (BTC) and cryptocurrency lending company Celsius, Alexander Mashinsky, has been arrested in the United States and charged with fraud.

According to Bloomberg agency, the arrest of Mashinsky, who founded Celsius in 2017, originated in the morning of this July 13th. However, there are no further details on the procedure.

The businessman has been accused by US authorities of fraud and attempted manipulation of the cryptocurrency market. The lawsuit was filed in federal court in New York.

They presented in detail requirements the United States Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) against Mashinsky and the Company.

According to the prosecutor Mashinsky “staged a plan” to scam Celsius users and related companies. That was between 2018 and 2022. Last year, the company filed for bankruptcy, signing Chapter 11 of the US bankruptcy code.

Celsius was one of the most prominent companies to fall out of favor in 2022

Celsius was one of the largest companies in the cryptocurrency ecosystem to go bankrupt during last year’s crisis. Directly affected by the fall of Terra and Luna in March 2022, Mashinsky’s company went underfreezing the money of thousands of users for several months.

At the end of January this year, Celsius published a list of users who can withdraw part of their frozen assets. The selected people can get back 94% of their balance in BTC, ETH and other crypto assets.

Mashinsky’s lawsuit and arrest comes exactly three days after Celsius received approval to liquidate its altcoin holdings. and convert them to bitcoin and etheras reported by CriptoNoticias.

Such a liquidation can have a significant impact on the market considering Celsius has more than $90 million in altcoins in existence at liquidation will produce a high price drop, according to analytics company Kaiko.

Following the news, native Celsius token CEL plunged 6.30%. Going from $0.158 to $0.148 in minutes, according to data from CoinMarketCap. However, recovered almost immediately and at the end of this article it is trading at around $0.1555.

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