New York Attorney General Letitia James announced Friday that her office has reached a settlement with Alex Mashinsky, the co-founder and former CEO of crypto lender Celsius Network, permanently barring him from the securities, commodities, and cryptocurrency industries.
James’ office said the deal could secure up to $35 million for New York. The money is conditional. Mashinsky would owe the state $25 million if he fails to forfeit $10 million in gains to the federal government, in addition to assets he has already forfeited. He would owe another $10 million if he does not serve his full prison sentence.
Federal case and bankruptcy proceedings
Mashinsky is serving a 12-year sentence in a parallel federal criminal case. The Commodity Futures Trading Commission said he pleaded guilty on Dec. 3, 2024, to one commodities fraud charge and one securities fraud charge.
He was sentenced on May 8, 2025, and ordered to forfeit $48,393,446. On June 18, the CFTC also said a consent order had resolved its own case against him, imposing a permanent injunction as well as permanent trading and registration bans.
The attorney general’s office said that, as of August 2026, more than $3.4 billion had been distributed to creditors in the Celsius bankruptcy.
What New York alleged
James sued Mashinsky in January 2023, alleging that he misled hundreds of thousands of people about the safety of Celsius, including more than 26,000 people in New York. According to the attorney general’s office, its investigation found that Mashinsky repeatedly described the platform as safer than a bank even though Celsius was not subject to bank-level federal or state requirements.
The office also said investor assets were put into high-risk strategies, many of which produced losses that he concealed, and that he failed to register as a salesperson and as a dealer under New York law.
In the release, James said: “Alex Mashinsky promised New Yorkers that his company was a secure place to invest their hard-earned savings, only to leave them penniless when his risky investments collapsed. I will not allow scammers to use cryptocurrencies to prey on unsuspecting New Yorkers.”
The office also encouraged crypto industry workers who have seen misconduct to file whistleblower complaints, which can be submitted anonymously.