During a hearing in federal court in New York, Alex Mashinsky said he would plead guilty to two of seven counts of conspiracy to defraud and manipulate the price of the Celsius domestic token (CEL). Mashinsky admitted that during an interview in 2021, he falsely stated that Celsius had received regulatory approval for Earn’s investment program. Mashinsky also admitted that he hid the sale of his CEL tokens.
As part of the plea agreement, Mashinsky will not appeal the court verdict, which is due on April 8, 2025. The founder of Celsius faces a maximum penalty of 30 years in prison. In September 2023, former Celsius revenue control director Roni Cohen-Pavon also admitted guilt and agreed to cooperate with the investigation.
“What I did was wrong. So I will try to do everything possible to correct this,” Mashinsky said.
In July 2023, federal prosecutors in Manhattan said Mashinsky misled Celsius customers by deceiving them into investing in the token and artificially inflating its value. Previously, the founder of Celsius refused to admit the charges brought against him.
“Mashinsky made approximately $42 million by selling his own CEL tokens at artificially inflated prices, while his clients lost their investments when the crypto lender went bankrupt,” prosecutor Damian Williams said.
The Celsius platform was founded in 2017, and the company filed for bankruptcy protection in July 2022. On January 31, the crypto lender emerged from bankruptcy proceedings and switched to Bitcoin mining. In February, Celsius distributed $2 billion in cryptocurrencies to 172,000 lenders.
Source: Bits
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