Celsius founder Alexander Mashinsky, who was behind the $4.7 billion crypto crash in 2022, has been banned from the crypto industry. This is part of a $10 million settlement with the Federal Trade Commission (FTC), while he continues to serve a 12-year prison sentence.
Celsius Founder Banned From Crypto as Part of $10 Million FTC Settlement
A court order from the FTC shows that the Celsius founder is permanently banned from crypto. The order says Mashinsky cannot advertise, market, promote, offer, distribute, or help with any of these activities for products or services used to deposit, exchange, invest, or withdraw assets.
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This crypto ban is part of a $10 million settlement with the FTC. The order also included a $4.72 billion monetary judgment against the Celsius founder in favor of the Commission. This amount relates to Mashinsky’s role in the 2022 crash of his crypto lending platform, which left customers unable to access $4.7 billion in deposits.
However, this monetary judgment has been suspended, and Mashinsky has been ordered to pay $10 million to satisfy the financial penalty. The order also notes that the crypto founder will be considered to have met this payment obligation if he pays the amount to the Department of Justice (DOJ) as part of the forfeiture order in his criminal case.
It’s worth noting that the Celsius founder is currently serving a 12-year sentence for fraud and market manipulation. He pleaded guilty in 2024 to commodities fraud and securities fraud at Celsius and was sentenced last year. Prosecutors revealed that Mashinsky used customers’ assets to make risky bets and to “line his own pockets.” In addition to his prison term, he was also sentenced to three years of supervised release and ordered to pay a $50,000 fine and forfeit $48 million.
Crypto Founder Denied New Trial In Fraud Case
Sam Bankman-Fried (SBF), who was convicted of fraud like Mashinsky, has had his request for a new trial denied. According to an ABC report, a federal judge rejected SBF’s request for a new trial, dismissing the FTX founder’s claims that there are new witnesses who could provide evidence to clear him of any wrongdoing.
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The judge called this claim baseless. SBF is currently serving a 25-year prison sentence for his role in the collapse of the now-defunct crypto exchange FTX. Bankman-Fried was found to have used up to $8 billion in customers’ funds for his personal projects.
However, he continues to deny any wrongdoing despite being found guilty, stating that his exchange was always solvent. It’s worth noting that SBF was also seeking a pardon from U.S. President Donald Trump, but the White House has said Trump has no plans to pardon him.
Featured image from iStock, chart from Tradingview.com
Frequently Asked Questions
Here is a list of FAQs about the CEO banned from crypto after a 47 billion crash written in a natural conversational tone
BeginnerLevel Questions
Q Wait a CEO crashed a company worth 47 billion How does one person do that
A Yes The CEO was in charge of FTX a major crypto exchange Poor management risky bets and alleged fraud caused the company to collapse wiping out billions in customer money
Q So this CEO is banned from crypto What does that actually mean
A It means he cant buy sell trade or even work for any cryptocurrency company or project Its like being banned from a casinohe cant set foot in the crypto industry at all
Q Who is the CEO were talking about
A Sam BankmanFried the founder and former CEO of FTX
Q How can you ban someone from an entire industry Isnt crypto decentralized
A The ban comes from a court order or a settlement with regulators If he violates the ban he can be arrested for contempt of court Decentralized or not the legal system still has power over individuals
Q Does this ban apply worldwide
A Not automatically The ban is usually issued by a US court Other countries might enforce it but its not a global automatic ban He just cant legally operate in the US or with US companies
IntermediateLevel Questions
Q How do regulators actually enforce a ban from crypto
A They monitor his financial accounts require him to report his assets and activities and work with crypto exchanges to flag his identity If he tries to open an account or trade the exchange is legally required to refuse him
Q Can he still hold the crypto he already owns
A Usually yesif its not part of the stolen or fraudulent funds But he might be forced to liquidate those assets to pay back victims He just cant buy more or trade actively
Q What happens if he uses a friend or family member to trade for him
A Thats called a straw man arrangement and its illegal Both he and the