The sentencing guidelines follow the crypto exchange founder’s willful disregard for the law
Alex Mashinsky, founder and ex-CEO of the collapsed crypto lending company Celsius, is now facing a potential 20-year prison sentence. The US Department of Justice (DOJ) submitted a sentencing recommendation yesterday, accusing him of orchestrating a wide-scale fraud scheme that left thousands of investors in financial ruin.
The DOJ’s statement pointed to a pattern of deception by Mashinsky, who allegedly misled users about the safety and profitability of Celsius’ services. After the company froze withdrawals on June 12, 2022, about $4.7 billion in user-held cryptocurrency became inaccessible. The government argues that this was not a simple business failure, but the result of years of dishonesty and self-enrichment.
According to court filings, Mashinsky personally gained more than $48 million while leading Celsius through activities that the DOJ describes as criminal and deliberate. He pleaded guilty in December 2024, admitting responsibility for the platform’s collapse and accepting that his actions caused over $550 million in damages. Federal prosecutors emphasized that these were not innocent mistakes, but calculated choices aimed at boosting his personal wealth.
The sentencing hearing is set for May 8 and will take place in Manhattan under US District Judge John Koeltl. The case has drawn attention not just because of Mashinsky’s high profile in the crypto space, but also due to the volume of victim statements. At least 200 individuals have submitted impact reports, describing how they were affected by the downfall of Celsius.
While Mashinsky has become the face of the company’s legal troubles, other figures have also been involved. His co-founders, including Shlomi Daniel Leon and Hanoch Goldstein, faced charges from the Federal Trade Commission in 2023. The FTC also imposed a $4.7 billion penalty against Celsius, reflecting the scale of financial damage tied to the case.
