Alex Mashinsky, the founder of the crypto lender Celsius, has settled with the US Federal Trade Commission (FTC). The high-profile case stems from allegations that Mashinsky and Celsius violated multiple areas of federal law, including claims tied to securities and commodities rules.
Celsius Founder’s New Limits
Under the terms described in the FTC’s latest filing, Mashinsky has been permanently restrained and placed under an injunction prohibiting him from advertising, marketing, promoting, offering, or distributing any product or service that could be used to deposit, exchange, invest, or withdraw assets.
The restriction applies whether the activity is carried out directly or through an intermediary. The language is broad, aiming to prevent the Celsius founder from operating or assisting in activities that would connect consumers to financial offerings involving crypto assets.
The settlement also includes a major monetary component. The filing states that the $4.72 billion judgment has been entered in favor of the FTC against Mashinsky as monetary relief.
It further notes that Mashinsky’s liability is joint and several with any other defendants, to the extent additional liability is ordered later. In addition, Mashinsky is ordered to pay the FTC $10 million.
While the settlement resolves this portion of the dispute, it does not necessarily cap the FTC’s broader options. The agreement is described as part of the continuing legal fallout tied to Celsius’s 2022 collapse, and it preserves the FTC’s ability to pursue the larger judgment if Mashinsky is found to have misstated or omitted assets in financial disclosures.
From ‘No Risk’ To 12 Years In Prison
The allegations that led to the fallout center on how Celsius users were “duped” into moving their cryptocurrency onto the Celsius platform.
The regulator says Mashinsky and Celsius represented that deposits were “safer” than keeping funds in a bank or other traditional financial institution, and that customer assets were protected because Celsius allegedly generated profits without exposing consumers to risk.
The FTC claims those assurances were false, including the assertion that Celsius earned money through secured crypto loans made to other exchanges while presenting the arrangement as carrying no risk to depositors.
The FTC also alleged that the crypto lender falsely advertised that a $750 million insurance policy covered customers’ assets. In addition, it alleges that customers were told they could withdraw their funds at any time, despite how Celsius ultimately functioned during the period leading up to its collapse.
Mashinsky’s legal exposure has also continued to escalate in criminal court. In May 2025, he was sentenced to 12 years in prison after pleading guilty to commodities fraud and securities fraud.
At the time of writing, Celsius’ native token, CEL, was trading at $0.017, marking a nearly 99.80% decline for the cryptocurrency since the network’s fallout in 2022.
Featured image from OpenArt, chart from TradingView.com
