Alex Mashinsky, former CEO of the bankrupt crypto lender Celsius, has strongly criticized the US Department of Justice's recommendation of a 20-year prison sentence against him—a term he condemned as a 'death-in-prison sentence.' The DOJ has argued that Mashinsky’s deliberate misconduct, including misleading Celsius users and manipulating the price of Celsius’ native token (CEL), warrants the severe penalty. He pleaded guilty in December 2024 to commodities fraud and price manipulation, having earned $48 million by selling his holdings before Celsius collapsed in June 2022. While the prosecution pushes for a lengthy incarceration, Mashinsky’s lawyers contend that his nonviolent, first-time offender status and contributions to business over 30 years merit a lighter sentence of no more than 366 days.
The case has drawn extensive attention, with federal prosecutors citing statements from hundreds of victims and recounting major financial losses stemming from the Celsius collapse. Celsius itself filed for bankruptcy in July 2022, owing $4.7 billion to creditors. As of August 2024, $2.53 billion has been distributed among 251,000 creditors, following an approved restructuring plan. Meanwhile, Mashinsky faces sentencing soon, with the wider industry observing the potential precedent this case might set for crypto executives culpable for fraud.