A U.S. federal judge this week entered a $4.72 billion judgment against Alex Mashinsky, the founder and former CEO of the collapsed crypto lending platform Celsius Network, and permanently banned him from the cryptocurrency and financial services industries. The consent decree, signed by Judge Denise L. Cote of the Southern District of New York on April 28, 2026, resolves civil charges brought by the Federal Trade Commission (FTC) against Mashinsky personally.
The $4.72B Judgment and Actual Payment
The judgment carries a monetary penalty of $4.72 billion, but requires only $10 million in actual payment — an amount Mashinsky can satisfy through his existing criminal forfeiture obligations to the Department of Justice. The full judgment remains enforceable if Mashinsky fails to accurately disclose his assets or makes materially false statements in financial filings. Importantly, the judgment cannot be discharged in bankruptcy, and compliance obligations, including record-keeping and reporting, last for up to 18 years.
Lifetime Ban: No Return to Crypto or TradFi
The permanent injunction covers a broad range of activities: Mashinsky is prohibited from advertising, marketing, promoting, offering, or distributing any product or service that allows users to deposit, exchange, invest, or withdraw assets — spanning both crypto and traditional finance (TradFi) sectors. This means that even after his eventual release from prison, Mashinsky will be barred from ever working in crypto or financial services again.
Background: From Industry Star to Federal Prison
Mashinsky founded Celsius Network in 2017, once holding billions in user assets and marketing itself as safer than a bank. In June 2022, the platform froze user withdrawals and filed for Chapter 11 bankruptcy in July of that year, leaving users with billions in losses. In December 2024, Mashinsky pleaded guilty to commodities fraud and securities fraud, admitting he misled users about Celsius's financial condition and manipulated the price of its native token CEL while secretly selling his own holdings. He is currently serving a 12-year sentence in federal prison.
Regulatory Aftermath: FTC's Crackdown on Crypto Lenders
The FTC first sued Celsius and three of its executives in July 2023, accusing them of deceptive and unfair practices under the FTC Act. Celsius settled its corporate charges in August 2023, agreeing to a $4.72 billion judgment and a permanent ban from crypto deposit, exchange, or payment services. Mashinsky, initially representing himself after his lawyers withdrew, reached a consent agreement with the FTC in early 2026. The settlement follows similar FTC actions against BlockFi and Genesis, reflecting continued federal scrutiny of crypto lending platforms that collapsed during the 2022 market downturn. Mashinsky remains in federal custody, and the civil decree adds permanent restrictions that would apply to any post-release activities.
With the civil and criminal cases against Mashinsky now concluded, the legal accountability for the Celsius collapse is largely complete — though users' losses, estimated in the billions, have only been partially recovered through bankruptcy proceedings. The case serves as a stark warning to the crypto industry that regulatory compliance and customer asset safety are non-negotiable.