Hundreds of Celsius investors seek a life sentence for CEO Alex Mashinsky after his fraud plea related to the firm’s 2022 collapse. Some victims push for leniency if funds are returned. The judge will determine sentencing on May 8, while bankruptcy issues continue to impact affected customers.
Victims of the failing cryptocurrency lender, Celsius Network, are pressing for a life sentence for its CEO, Alex Mashinsky, following his guilty plea to fraud charges. In a recent court filing, more than 200 victim impact statements were submitted to a judge in preparation for Mashinsky’s sentencing on May 8, with many investors pointing to significant financial losses as a consequence of his actions during the 2022 collapse.
Affected investors express deep disappointment, with one individual, Brandon Lawrence, lamenting the loss of not just funds but also personal dreams and ambitions due to Mashinsky’s alleged misconduct. He said, “The prospects I once envisioned are now unattainable, all due to Alex Mashinsky and his ill-timed bankruptcy filing.”
Conversely, some victims advocate for a more lenient sentence. Retired teacher Stephen Levenberg, who lost nearly $400,000, stated he would accept a three-year prison term if Mashinsky agreed to return the misappropriated funds. This viewpoint contrasts with the general desire for harsher penalties from other victims.
Mashinsky’s legal team is pushing for a much lighter sentence of no more than one year. Meanwhile, probation officers have suggested a sentence of approximately 15 years. As for prosecutors, they are still in the process of determining their formal recommendations.
The Celsius saga unravelled dramatically in June 2022, when the firm froze client asset withdrawals, only to declare bankruptcy a month later. At that time, Celsius claimed a mere $167 million remained in its accounts to manage debts, raising further concerns among investors. Reports have since surfaced indicating that Mashinsky and his wife withdrew around $12 million in cryptocurrency from the company prior to the bankruptcy announcements. Founded in 2018, Celsius had expanded rapidly to employ about 200 individuals and managed approximately $10 billion in crypto assets by 2021.
