Mashinsky Permanently Banned
CFTC Permanently Bans Alexander Mashinsky from Trading Regulated Markets After Celsius Fraud Admissions
Anonymous
Key Points
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The CFTC consent order was approved by a federal judge on June 12, 2026, formally recording the regulator’s permanent prohibitions in the U.S. District Court for the Southern District of New York.
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In addition to permanent trading and registration bans, the CFTC order states Mashinsky is “permanently restrained, enjoined and prohibited” from commodities activity and also prohibits him from engaging in future violations of the CFTC’s anti-fraud provisions.
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As part of Celsius’s wind-down, some funds were used to create a new bitcoin mining company called Ionic Digital.
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The SEC’s parallel case alleged not only fraudulent/unregistered crypto fundraising and repeated lies about Celsius’s financial condition, but also that Mashinsky and Celsius manipulated the price of CEL, the company’s native token.
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Beyond the 12-year prison term and forfeiture order, Mashinsky’s criminal case also included a $50,000 fine, according to coverage of the sentencing and subsequent CFTC resolution.
A federal judge in New York permanently banned former Celsius Network CEO Alexander Mashinsky from trading in any CFTC-regulated market on June 12, 2026, formally closing the agency's 2023 enforcement case CoinCentral. The consent order caps what regulators called the CFTC's first-ever enforcement action against a digital-asset lending platform — and adds to a punishment that already includes a 12-year federal prison sentence and $48 million in criminal forfeitures CoinMarketCap.
The ban imposes no new fines but permanently bars Mashinsky from registering with the CFTC and from future commodities trading. Customers who trusted Celsius with their savings lost an estimated $4.7 billion to $5 billion when the platform froze withdrawals in June 2022 and filed for bankruptcy weeks later Maxbit.
How a 'Safer Bank' Became a $5 Billion Fraud
Mashinsky founded Celsius in 2017 with a simple pitch: deposit your crypto and earn up to 18% annual interest — safer than a traditional bank. He wore t-shirts reading "Banks are not your friends" while Celsius quietly funneled customer deposits into high-risk, illiquid investments CoinCentral. The gap between the marketing and the reality was the core of every charge regulators brought against him.
When crypto markets crashed in June 2022, Celsius froze all withdrawals, citing "extreme market conditions." One month later, it filed for Chapter 11 bankruptcy in the Southern District of New York, revealing a $1.2 billion hole in its balance sheet. Customers were locked out of billions in deposits they had been told were safe Maxbit.
Four Agencies Hit Mashinsky From Every Angle
In July 2023, the DOJ, SEC, CFTC, and FTC launched a coordinated strike. The DOJ charged Mashinsky with securities, commodities, and wire fraud. He was convicted in January 2025, sentenced to 12 years in prison, fined $50,000, and ordered to forfeit $48 million CoinMarketCap. The CFTC focused on commodities fraud and market manipulation tied to Celsius's native CEL token.
The SEC alleged Mashinsky raised billions through fraudulent and unregistered crypto sales and manipulated the price of CEL. The FTC initially sought a $4.7 billion judgment matching customer losses — then settled for $10 million after finding his personal assets were largely depleted CoinCentral. All three agencies focused on the same core lie: Celsius was safe when it was not.
Permanent Ban Ends Any Path Back to Financial Markets
The June 12, 2026 consent order goes beyond prison. It permanently "restrains, enjoins and prohibits" Mashinsky from any commodities trading activity and from registering with the CFTC in any capacity — including as a Commodity Pool Operator or Commodity Trading Advisor CoinCentral. No new monetary penalties were added; the order's power lies entirely in barring him from markets for life.
The CFTC called it a landmark result. The case established that "yield" products tied to Bitcoin and Ethereum — which the CFTC treats as commodities — fall squarely within its jurisdiction CoinMarketCap. Future crypto executives now face the prospect of lifetime bans as a standard part of any fraud settlement, not just prison time and fines.
What Creditors Got: A Bitcoin Miner Instead of Cash
Celsius officially exited bankruptcy in February 2025. Rather than a full liquidation, some customer funds were used to create Ionic Digital, a new Bitcoin mining company CoinCentral. Creditors became shareholders in a mining venture still subject to crypto market swings — a recovery tied to Bitcoin prices rather than a fixed dollar payout.
Mashinsky, meanwhile, has argued in post-conviction filings that Sam Bankman-Fried and Alameda Research orchestrated a "coordinated attack" that triggered Celsius's collapse and that his counsel was ineffective Maxbit. Courts have not accepted those arguments. He remains imprisoned, banned from markets, and stripped of tens of millions in assets — as the CFTC's case officially closes its books.
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