Mashinsky faces 20-year sentence over $48 million Celsius fraud

Alex Mashinsky, founder and former CEO of Celsius, criticised the US Department of Justice’s request for a 20-year prison sentence, calling it a “death-in-prison sentence.”

The sentencing is scheduled for May 8, following Mashinsky’s December 2024 guilty plea to commodities fraud and manipulating the price of Celsius’s CEL (CRYPTO:CEL) token.

Prosecutors say Mashinsky earned $48 million by selling his holdings before Celsius collapsed in June 2022.

The Department of Justice described his crimes as deliberate and calculated efforts to deceive Celsius users.

Mashinsky’s lawyers filed a reply on May 5 in a New York district court, arguing that the DOJ’s request ignores his nonviolent first-time offender status and a previously unblemished 30-year business record.

They urged the court to impose no more than 366 days in prison.

“The government’s venom-laced submission recasts this case as one involving a predator with an intent to target victims, harm them, and steal their money,” the defense said.

The lawyers also argued that Mashinsky is being unfairly scapegoated for decisions made collectively by the company and market fluctuations beyond his control.

In April, federal prosecutors submitted victim statements describing how many lost life savings after trusting Mashinsky’s assurances about Celsius’s safety.

Celsius filed for Chapter 11 bankruptcy in July 2022, owing $4.7 billion after halting withdrawals amid market volatility.

A restructuring plan approved in November 2023 has since repaid $2.53 billion to over 251,000 creditors.

Former Celsius chief revenue officer Roni Cohen-Pavon pleaded guilty to similar charges, but his sentencing has been delayed until after Mashinsky’s.