Alex Mashinsky: DoJ Requests 20-Year Sentence For Celsius CEO

The US Department of Justice (DoJ) has recommended a 20-year prison sentence for Alex Mashinsky, the founder and former CEO of the collapsed crypto lending platform Celsius Network.

DoJ seeks heavy sentence for Celsius founder

In a sentencing memorandum filed on 28 April 2025, federal prosecutors accused Mashinsky of orchestrating a multi-year fraud scheme that misled thousands of investors and resulted in billions in losses.

Mashinsky pleaded guilty in December 2024 to several criminal charges, including securities fraud, commodities fraud, and wire fraud. His sentencing is scheduled for 8 May 2025.

“Lies and self-dealing caused billions in harm”

The DoJ’s filing argues that Mashinsky’s misconduct was not a one-time lapse in judgment but a sustained campaign of deception. Prosecutors stated that Celsius’ business model was built on misleading promises and high-risk practices disguised as stable and secure. At its peak, Celsius claimed to manage more than $20billion in customer deposits.

According to the filing, Mashinsky used user funds to manipulate the price of Celsius’ native token (CEL) while personally selling his holdings for profit. Prosecutors allege that he made over $48m through these actions.

The government also noted Mashinsky’s “profound lack of responsibility”, pointing to his refusal to express genuine remorse and his continued framing of himself as a victim of market conditions. Prosecutors said this stance reinforces the need for a significant sentence to deter similar misconduct within the crypto industry.

CEL token rallies despite being functionally worthless

While Mashinsky’s legal future looks bleak, the CEL token has been staging an improbable rally. The token, which lost all utility after Celsius filed for bankruptcy in July 2022, saw a sharp spike of over 46% in the last trading session, closing at $0.155 after hitting an intraday high of $0.182.

According to TradingView data, daily trading volume surged to nearly 184,000 CEL, and the Relative Strength Index (RSI) has now entered extreme overbought territory at 81.04. The current price trend shows a clear parabolic breakout but with fundamentals that offer no clear value case.

CEL’s current surge likely stems from speculative trading around the Mashinsky sentencing news and opportunistic momentum trading. Despite lacking utility, the token continues attracting traders, highlighting how sentiment and headlines can still drive movement in crypto markets, even for defunct assets.

Fallout from the Celsius collapse

Celsius filed for bankruptcy in July 2022, weeks after freezing withdrawals in the wake of broader market turbulence. More than $4.7bn in customer funds were locked when the platform failed.

Following its collapse, Celsius entered a non-prosecution agreement with the US government, admitting to misrepresenting the safety and stability of its products. The company acknowledged that customer assets had been misused to cover operational shortfalls and maintain appearances.

Mashinsky’s sentencing comes as US authorities increase pressure on crypto executives following several high-profile scandals.

If the court grants the DoJ’s request, the 20-year sentence would rank among the most severe penalties handed down to a crypto industry leader, on par with the sentence given to FTX founder Sam Bankman-Fried, who is now cooperating in separate legal proceedings.