Michaela
Alex Mashinsky, founder and former CEO of collapsed crypto lender Celsius, has pushed back against a proposed 20-year prison sentence, criticizing the U.S. government’s stance as excessive and unwarranted.
The U.S. Department of Justice (DOJ) formally recommended a minimum 20-year prison sentence for Mashinsky, citing his role in deceiving Celsius users and personally profiting from the manipulation of the platform’s native token. If the court grants the DOJ’s request, Mashinsky would be nearly 80 years old by the time of his release.
In a response filed with a New York district court, Mashinsky’s legal team contended that the former Celsius CEO should face no more than a 366-day sentence. They argued the DOJ failed to properly weigh his status as a nonviolent, first-time offender with a previously clean record over a three-decade career in business.
“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 memorandum stated, characterizing the recommended sentence as a “death-in-prison sentence.”
Mashinsky’s legal team contended that the DOJ’s pursuit of a 20-year sentence stems from his refusal to accept what they described as the government’s overblown portrayal of him as having engaged in fraud from the outset.
“Alex is inserted as the scapegoat for every corporate action, every group decision, every unanimous vote, every market fluctuation, and every employee’s watercooler speculation,” the memorandum stated.
The DOJ argued that Mashinsky’s guilty plea confirmed his crimes were intentional and calculated acts of fraud, carried out through deliberate deception and theft.
In the days leading up to the DOJ’s April 28 sentencing recommendation, U.S. federal prosecutors submitted victim impact statements from hundreds of individuals who suffered financial losses in the Celsius collapse. Many described placing their life savings into the platform, relying on Mashinsky’s repeated assurances that their funds were secure.
Mashinsky pleaded guilty in December 2024 to commodities fraud and market manipulation as part of a plea deal, admitting he earned $48 million by offloading CEL tokens before Celsius collapsed in June 2022.
The former CEO initially faced seven charges filed in July 2023. Celsius filed for Chapter 11 bankruptcy on July 13, 2022, after freezing withdrawals and citing extreme market volatility, ultimately owing $4.7 billion to creditors.
A U.S. bankruptcy court approved the firm’s restructuring plan in November 2023, and by August 2024, $2.53 billion had been distributed to 251,000 affected customers.
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Michaela has no crypto positions and does not hold any crypto assets. This article is provided for informational purposes only and should not be construed as financial advice. The Shib Magazine and The Shib Daily are the official media and publications of the Shiba Inu cryptocurrency project. Readers are encouraged to conduct their own research and consult with a qualified financial adviser before making any investment decisions.
