CFTC Bans Ex-Celsius CEO Alexander Mashinsky From Trading and Registration

TLDR

• The CFTC resolved its 2023 enforcement case against Alexander Mashinsky.
• Mashinsky was permanently banned from CFTC trading and registration.
• The CFTC alleged Celsius misled customers about platform safety and profits.
• Celsius received customer funds valued at about $20B before bankruptcy.
• Mashinsky was sentenced to 12 years in prison in a parallel criminal case.

The Commodity Futures Trading Commission has secured a final consent order against former Celsius Network CEO Alexander Mashinsky, permanently banning him from CFTC-regulated trading and registration after the collapse of the crypto lending platform.

The order was entered by the U.S. District Court for the Southern District of New York and resolves the CFTC’s 2023 enforcement action against Mashinsky. The agency said the order permanently enjoins him from further violations of certain anti-fraud provisions under the Commodity Exchange Act and CFTC regulations.

Mashinsky is already serving a 12-year prison sentence after pleading guilty in a parallel criminal case. He admitted to one count of commodities fraud and one count of securities fraud tied to his conduct at Celsius, which filed for bankruptcy in 2022 after receiving customer funds valued at about $20 billion.

CFTC Resolves Celsius Case With Permanent Ban

The CFTC filed its complaint against Celsius and Mashinsky on July 13, 2023. The complaint alleged that Celsius operated an online platform where customers deposited digital assets, which the company pooled and used to generate revenue.

Celsius promoted the platform as a way for customers to earn weekly interest payments or rewards on their digital asset deposits. The CFTC alleged that from 2018 through at least June 2022, Mashinsky and Celsius misrepresented the safety, profitability, and regulatory status of the platform.

According to the agency, Mashinsky used videos, blog posts, livestreams, social media posts, and website statements to present Celsius as a safe alternative to a traditional bank. The complaint said those claims were made while Celsius was using increasingly risky strategies to meet promised customer returns.

The court entered a consent order against Celsius in July 2023, leaving Mashinsky as the remaining defendant in the CFTC case. Thursday’s order closes that enforcement action against him.

Celsius Customers Were Misled, Regulators Said

The CFTC said Celsius extended millions of dollars in uncollateralized loans and entered risky decentralized finance arrangements while continuing to tell customers their assets were secure and earning rewards.

Regulators alleged that Celsius suffered severe losses before the company’s bankruptcy. Customer assets were not secure, despite public statements that presented the platform as stable and profitable.

Celsius became one of the most prominent crypto lenders to collapse during the 2022 market downturn. Its failure followed a broader wave of distress across digital asset firms and left many customers waiting through bankruptcy proceedings to recover funds.

The company was later wound down in 2024. As part of the restructuring process, some assets were used to create Ionic Digital, a Bitcoin mining company connected to the Celsius bankruptcy plan.

The CFTC did not impose additional monetary penalties in the latest order. The main consequence from the regulator’s final resolution is the permanent restriction on Mashinsky’s ability to register with the agency or trade in markets it oversees.

Mashinsky Already Sentenced in Criminal Case

The U.S. Attorney’s Office for the Southern District of New York brought a parallel criminal case against Mashinsky in July 2023. The case involved the same broader conduct described in the CFTC’s action.

Mashinsky pleaded guilty on December 3, 2024, to commodities fraud and securities fraud. On May 8, 2025, he was sentenced to 12 years in prison, ordered to pay a $50,000 fine, and ordered to forfeit $48.39 million.

Other federal agencies also pursued Celsius-related actions. The Securities and Exchange Commission sued Celsius and Mashinsky in 2023, alleging fraudulent and unregistered crypto offerings, false statements about the company’s financial condition, and manipulation of the CEL token.

Mashinsky also reached a $10 million settlement with the Federal Trade Commission after the agency accused Celsius executives of deceptive and unfair practices in marketing crypto lending and custody services.

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