Alex Mashinsky, the former CEO of collapsed cryptocurrency lending platform Celsius Network, has surrendered to federal authorities to begin serving a 12-year prison sentence. Mashinsky pleaded guilty in December 2024 to two felony charges related to making false statements about Celsius' Earn Program, which promised high yields on user deposits but ultimately led to billions in losses for investors.
The sentencing follows Celsius' dramatic collapse and bankruptcy filing in July 2022, which revealed a $1.2 billion hole in its balance sheet. At its peak, Celsius managed $25 billion in assets for over 1.7 million users, marketing itself as a safer alternative to traditional banks. The platform unraveled following the Terra ecosystem collapse, with court-appointed examiners concluding Celsius operated "more akin to a Ponzi scheme" by using new deposits to cover existing obligations.
Mashinsky will serve his sentence at the Federal Prison Camp in Otisville, New York, a minimum-security facility known for housing white-collar offenders. In addition to his prison term, he was required to forfeit all claims to Celsius' assets and pay $40 million in restitution. The company emerged from bankruptcy in January 2024 and has distributed approximately $3 billion in assets to creditors, less than half of the $7.7 billion owed.
