{"id":122032,"date":"2023-07-13T17:30:59","date_gmt":"2023-07-13T17:30:59","guid":{"rendered":"https:\/\/dripp.zone\/news\/former-celsius-ceo-alex-mashinsky-reportedly-arrested-crypto-news\/"},"modified":"2023-07-13T17:31:02","modified_gmt":"2023-07-13T17:31:02","slug":"former-celsius-ceo-alex-mashinsky-reportedly-arrested-crypto-news","status":"publish","type":"post","link":"https:\/\/dripp.zone\/news\/former-celsius-ceo-alex-mashinsky-reportedly-arrested-crypto-news\/","title":{"rendered":"Former Celsius CEO Alex Mashinsky reportedly arrested\n – Crypto News"},"content":{"rendered":"
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The former CEO of now-bankrupt crypto lender Celsius, Alex Mashinsky<\/a>was reportedly arrested on the morning of July 13. The news broke minutes after the United States Securities and Exchange Commission filed a lawsuit against the crypto lender<\/a> on the same day.<\/p>\n

The former CEO was reportedly arrested after a probe<\/a> into the company’s collapse, Reported <\/a>Bloomberg, citing people familiar with the matter. The US Department of Justice indicted Mashinsky on charges of fraud and intent to manipulate the market. <\/p>\n

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UPDATE: Per DOJ indictment, legal minds expect Alex Mashinsky to face a lengthy prison sentence. <\/p>\n

\u201cThese (DOJ) charges, and the scale of capital involved, means he doesn’t have a meaningful path to a plea; looking at 15-20 years.”<\/p>\n

Securities fraud, wire fraud, conspiracy:\u2026<\/p>\n

Andrew (@AP_Abacus) July 13, 2023<\/a><\/p><\/blockquote>\n

Celsius Network filed for bankruptcy on July 14<\/a> last year. Mashinsky was recently found guilty by investigators<\/a> of the Commodity Futures Trading Commission, which concluded that the former CEO broke numerous US regulations before the company’s implosion in 2022.<\/p>\n

The investigation against the former CEO began after the New York Attorney General sued Mashinsky on Jan. 5<\/a>, The NYAG alleged that the former CEO misled investors and caused billions of dollars in losses. <\/p>\n

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I’m suing the former CEO of cryptocurrency platform @CelsiusNetwork<\/a> for defrauding investors out of billions of dollars.<\/p>\n

Alex Mashinsky lied to people about the risks of investing in Celsius, hid its deteriorating financial condition, and failed to register in New York.<\/p>\n

\u2014 NY AG James (@NewYorkStateAG) January 5, 2023<\/a><\/p><\/blockquote>\n

The trouble for Celsius and its former CEO began in June last year when the crypto lender abruptly suspended withdrawals on the platform. On June 16, 2022, securities regulators from five different US states opened an investigation into Celsius<\/a>and within a month, the platform filed for bankruptcy.<\/p>\n

While Celsius suffered from the larger crypto contagion that saw the implosion of the Terra ecosystem followed by the collapse of crypto hedge fund Three Arrows Capital, a CFTC investigation found that Celsius and its former CEO broke several banking laws and misguided and lied to their customer base. . <\/p>\n

Related: <\/em><\/strong>Tourists unhappy with crypto payments ban in Bali<\/em><\/strong><\/a><\/p>\n

The pandemic helped the Celsius cryptocurrency lending platform gain traction in 2021 during the bull run. The platform offered attractive interest rates on cryptocurrency deposits, several of which ran in double digits. Mashinsky often marketed these products as safer substitutes for those provided by conventional banks. But the demise of Terra’s algorithmic stablecoin, UST, and a slump in the cryptocurrency market had dire effects on the business. <\/p>\n

The arrest of Mashinsky and the lawsuit against Celsius comes within months of the SEC’s lawsuits against crypto exchanges Binance <\/a>and Coinbase<\/a>, <\/p>\n

Celsius network didn’t immediately respond to Cointelegraph’s requests for comments.<\/p>\n

Collect this article as an NFT<\/a><\/em><\/strong> to preserve this moment in history and show your support for independent journalism in the crypto space.<\/em><\/em><\/p>\n

Magazine: <\/em><\/strong>Should you ‘orange pill’ children? The Case for Bitcoin Kids Books<\/em><\/strong><\/a><\/p>\n