New York Reaches Up-to-$35 Million Settlement with Ex-Celsius CEO Mashinsky, Bars Him from Crypto Industry for Life
ALBANY, N.Y. — New York Attorney General Letitia James announced on October 9 that her office has reached a settlement with Alex Mashinsky, the co-founder and former chief executive of the collapsed cryptocurrency lender Celsius Network, securing up to $35 million in conditional payments and permanently barring him from the securities, commodities and cryptocurrency industries.
The settlement resolves a civil lawsuit James's office filed in 2023, which accused Mashinsky of misleading hundreds of thousands of investors — including more than 26,000 New Yorkers — about the safety of deposits at Celsius. Prosecutors said he repeatedly presented Celsius as safer than a bank while the company deployed customer assets in high-risk investment strategies and concealed the resulting losses, in order to attract billions of dollars in digital-asset deposits.
Under the settlement, Mashinsky must pay $25 million to New York if he fails to forfeit $10 million in ill-gotten gains to the federal government, in addition to assets already forfeited under his federal plea agreement. He must pay a further $10 million to New York if he does not serve his full prison sentence, as mandated by the criminal court and overseen by the Bureau of Prisons. In other words, the $35 million is a ceiling that applies only if he misses the forfeiture or prison terms of his federal case; the permanent industry ban, however, takes effect regardless.
"Alex Mashinsky promised New Yorkers that his company was a secure place to invest their hard-earned savings, only to leave them penniless when his risky investments collapsed," James said in a statement. "I will not allow scammers to use cryptocurrencies to prey on unsuspecting New Yorkers."
Background: Mashinsky pleaded guilty on December 3, 2024, to securities fraud and commodities fraud in a parallel federal criminal case. He was sentenced on May 8, 2025, to 12 years in federal prison and ordered to forfeit $48,393,446. Celsius froze customer withdrawals in June 2022 and filed for bankruptcy a month later; according to the attorney general's office, creditors have received more than $3.4 billion through the bankruptcy proceedings as of August 2026.
The New York settlement caps a cascade of enforcement actions. In April 2026, the Federal Trade Commission reached an agreement with Mashinsky that included a $10 million payment and a stayed $4.72 billion judgment. In June 2026, the Commodity Futures Trading Commission imposed a permanent trading and registration ban. In September 2026, Mashinsky reached an agreement in principle with the Securities and Exchange Commission. The state settlement closes New York's own case while layering a lifetime ban on top of the federal penalties.
Impact: The deal marks the state-level conclusion of one of the largest crypto-lender collapses in U.S. history. For the more than 26,000 New Yorkers who held deposits at Celsius, the bankruptcy distributions — now above $3.4 billion — remain the main path to recovery, while the lifetime industry ban ensures Mashinsky cannot return to the financial businesses where regulators say he caused the harm.
Published by GSM · USA (original Chinese edition)
Photo: Kenneth C. Zirkel 摄，CC BY-SA 4.0（Wikimedia Commons）
