Founder of failed crypto lending platform Celsius Network should face 20 years behind bars, prosecutors argue
Founder and former CEO of failed cryptocurrency lending platformCelsius NetworkIt has to face 20 years behind the bars for lying and self-dealing with the customers of billions of dollars in losses, prosecutors told a judge on Tuesday.
Alexander Mashinsky59, told thousands of customers that their money was safe and safe, leading investors who were pouring over $ 20 billion in Celsius in 2021, they wrote a submission in advance of a scheduled May 8th of the Manhattan Federal Court.
“They are not,” said prosecutors, mentioned that Celsius declared the losses in 2022 and acknowledged that it did not return to customers what they were investing in.
Prosecutors said Mashinsky's profitability Celsius and put customers' funds at the mercy of uncollateralized loans and unspecified market bets. Meanwhile the company announced itself as a modern-day bank where people can deposit crypto assets and earn interest.
“Mashinsky's behavior enriched him,” they wrote.
During their own submission to the judge, defense attorneys said their client must face a year and a day in prison after seeking a sin in December on federal fraud charges. In doing so he admitted to misleading customers between 2018 and 2022.
The defense blamed Celsius's collapse in a “cataclysmic downturn” of cryptocurrency markets in May and June of 2022.
“His actions were never predators, exploited or venals. He never acts with the desire to hurt anyone. He never steals money or is discouraged by anyone's possessions. And he has never been driven by greed, cruelty, or Avarice,” the lawyers said.
They also mentioned that Mashinsky was having a hard time in an early life in a small Ukrainian town in the former Soviet Union, that his family fled when he was 7. They moved to Israel, where Mashinsky served three years in Israel's defense forces as a pilot fighter.
“This case is not about a proud, greedy swindler who thought he could get away from stealing people's money to satisfy his own hedonistic pleasures. It's also not about a poor company exposed as a card of cards when it is bankrupt. They are posthoc, furry and deadly trophies that do not apply here,” said the defense.
The lawyers described Mashinsky as a loyal father to six children deserving inside because his crimes arose from “otherwise legitimate efforts to cross criminality as a result of unexpected suffering.”
At his request, Mashinsky admitted that Celsius' proprietary crypto token was illegally manipulated while secretly selling his own tokens at the upbringing prices to cost about $ 48 million.
In court, he admitted that in 2021 he suggested to the public that there was regulation of permission for the company's movements because he knew the customers would “find the wrong comfort”.
He said that in 2019, he sold crypto tokens even though he told the public that he was not, knowing customers would also get the wrong comfort from there.
A accusation that Mashinsky claims to have promoted Celsius through media interviews, his social media accounts and website of Celsius', along with a weekly “Ask Mashinsky whatever” session posted on the Celsius website and a YouTube channel.
This story was originally featured on Fortune.com
