New York bars ex-Celsius CEO Mashinsky in $35M conditional settlement

Former Celsius Network CEO Alex Mashinsky accepted a permanent bar from the securities, commodities and cryptocurrency industries under a settlement announced Oct. 9 by New York Attorney General Letitia James, with payments of up to $35 million conditioned on his federal forfeiture and prison term.

The money is conditional rather than due at once. Mashinsky must pay New York $25 million if he fails to forfeit an additional $10 million in ill-gotten gains to the federal government beyond assets already forfeited under his federal plea agreement, according to the attorney general's release. He must pay another $10 million to the state if he does not serve his full prison sentence as ordered by the criminal court and overseen by the Bureau of Prisons.

"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," James said in the release. "I will not allow scammers to use cryptocurrencies to prey on unsuspecting New Yorkers."

Mashinsky is serving a 12-year federal prison sentence from the parallel criminal case, the release says. He pleaded guilty in December 2024 to securities and commodities fraud tied to Celsius and was sentenced in May 2025, Cointelegraph reported. Federal prosecutors had sought 20 years, and Mashinsky was released on $40 million bail before trial, Decrypt reported.

The criminal case also ordered him to forfeit more than $48 million to the federal government, a figure all three outlets matched against the state release. That forfeiture is the trigger for the larger state payment. Mashinsky owes New York $25 million only if he fails to hand over a further $10 million on top of assets already forfeited, Decrypt wrote.

The ban and the 2023 lawsuit

The settlement permanently bars Mashinsky from doing business in the securities, commodities and cryptocurrency industries, the release says. CoinDesk described the restriction as a lifetime crypto ban in its headline while using permanent ban in the body, in its Oct. 9 report. The release does not spell out a geographic limit beyond the state action, so the filing itself is the safest guide to the scope.

The state case began in 2023, when James sued Mashinsky for misleading hundreds of thousands of investors, including more than 26,000 New Yorkers, about the safety of deposits at Celsius. Celsius froze withdrawals in June 2022 and filed for bankruptcy the next month. More than $3.4 billion has since been distributed to creditors, a figure the release dates to August 2026.

James also announced the settlement on X, writing that her office was barring Mashinsky from the financial industry after he left savers penniless and that she would not allow scammers to prey on New Yorkers, Decrypt reported. The full statement in the release adds: "We took action to hold Mashinsky accountable, and now we are barring him from the securities industry so he cannot take advantage of investors again."

Federal regulators had already restricted him. The Federal Trade Commission reached a settlement in April that included $10 million plus a largely suspended $4.72 billion judgment, and the Commodity Futures Trading Commission imposed a permanent trading and registration ban in June, Cointelegraph noted. The Securities and Exchange Commission agreed in principle to a settlement in September and dismissed its case without prejudice on Sept. 29, according to the same report.

Mashinsky is challenging the criminal outcome. He has asked a court to vacate his 12-year sentence and is representing himself, per the Oct. 9 account. Federal prosecutors opposed that motion in August, a judge denied his request for discovery, and an Oct. 5 order left that decision unchanged, Cointelegraph reported. He has until Dec. 11 to respond.

The release does not describe any collection mechanism beyond the two triggers, and none of the outlets spelled one out. What is fixed: the bar is permanent, the $35 million is conditional, and both payments turn on what happens in the federal case first.