Alex Mashinsky, founder and former CEO of crypto lending firm Celsius, has been sentenced to 12 years in prison for fraud that resulted in billions of dollars in customer losses, the Department of Justice said on Thursday.
Mashinsky pleaded guilty last December to one count of securities fraud and one count of commodities fraud related to the collapse of Celsius, which once held $25 billion in assets.
Read: Ex-Celsius CEO Alex Mashinsky Pleads Guilty to Fraud in $1 Billion Celsius Collapse
The cryptocurrency platform abruptly halted withdrawals and transfers during a broader crypto market crash in 2022, before filing for bankruptcy shortly afterward.
Prosecutors accuse Mashinsky of misrepresenting the company’s business operations and artificially inflating the price of Celsius’s token by purchasing it on the open market.
According to the Department of Justice statement, Mashinsky targeted retail investors with promises of secure digital assets while using those assets for risky investments and personal gain. The fraud resulted in Mashinsky profiting millions while customers lost billions.
The sentencing comes as the Trump administration adopts a softer stance on cryptocurrency regulation. A memo obtained by The Washington Post revealed the disbandment of a DOJ division dedicated to investigating crypto firms, while the Securities and Exchange Commission has dropped cases against several companies in the sector.
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