Former CEO of Celsius Alex Mashinsky reportedly apprehended

On July 13, the U.S. SEC filed a complaint against the crypto lender, and subsequent news reports detailed the arrest of the company’s former CEO, Alex Mashinsky.

On the morning of July 13, reports surfaced that Alex Mashinsky, the former CEO of defunct crypto lender Celsius, had been detained. Minutes earlier the same day, the United States Securities and Exchange Commission had sued the cryptocurrency lender.

Bloomberg reported, citing sources with knowledge of the situation, that the former CEO was detained after an investigation into the company’s failure. Mashinsky was indicted by the United States Department of Justice for fraud and market manipulation.

A bankruptcy petition for Celsius Network was filed on July 14 of last year. Commodity Futures Trading Commission investigators have found Mashinsky guilty of many violations of U.S. laws before to the company’s collapse in 2022.

When the cryptocurrency lending platform Celsius suddenly stopped processing withdrawals in June of last year, problems started for the company and its former CEO. Celsius filed for bankruptcy on July 16, 2022, less than a month after securities authorities in five U.S. states launched an inquiry against the company on June 16, 2022.

A CFTC investigation revealed that Celsius and its former CEO broke several banking laws and incorrectly deceived their customer base, contributing to the company’s downfall alongside the wider crypto contagion that saw the breakdown of the Terra ecosystem and the collapse of the crypto hedge fund Three Arrows Capital.

Following on the heels of the SEC’s actions against Binance and Coinbase, the arrest of Mashinsky and the complaint against Celsius have both been filed.

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