Former Celsius Network CEO Alex Mashinsky was handed a 12-year federal prison sentence on Thursday for his involvement in a fraudulent scheme. Mashinsky’s December guilty plea revealed his manipulation of investors and the market value of Celsius’s native token, CEL.

### Sentence Pronouncement

On May 8, the U.S. Attorney’s Office, Southern District of New York, disclosed Mashinsky’s sentencing, following his admission to committing commodities and securities fraud at Celsius Network LLC. U.S. District Judge John G. Koeltl, at the Southern District courthouse in Manhattan, delivered the verdict. Mashinsky had confessed to overrepresenting the financial health of Celsius and promising investors unrealistic returns.

“Alexander Mashinsky lured retail investors with assurances of security for their ‘digital assets’ better than that of banks,” U.S. Attorney Jay Clayton expressed. “Contrarily, he exploited those assets for high-risk ventures and personal gain.”

In court, Mashinsky acknowledged inflating CEL token prices while secretly selling his stockpile worth millions. He agreed to surrender his illegal earnings. Although prosecutors sought a 20-year sentence, highlighting Mashinsky’s lack of remorse and the extensive harm to Celsius’s customers, he settled for a maximum of 30 years and waived his right to appeal.

### Legal Woes Unfold

Mashinsky’s arrest in 2023 on charges of securities, commodities, and wire fraud marked the start of his legal battles. His arrest aligned with Celsius’s tentative agreement on a $4.7 billion settlement with the Federal Trade Commission, pending the return of customer assets. Further unraveling the case, former chief revenue officer Roni Cohen-Pavon pled guilty and collaborated with authorities, providing critical insights into Celsius’s operations. This cooperation aided the broader case against Celsius and Mashinsky by the SEC and CFTC, culminating in Mashinsky’s sentencing and the closure of one of the crypto realm’s most contentious legal dramas.

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