New York Attorney General Letitia James announced a settlement with former Celsius CEO Alex Mashinsky that permanently bars him from working in the cryptocurrency, securities, and commodities industries, as part of an agreement with conditional payments of up to $35 million.

The settlement ends a civil lawsuit filed in 2023 that accused Mashinsky of misleading hundreds of thousands of investors about the safety of Celsius before its collapse in 2022. Under the agreement, Mashinsky will pay $25 million to New York if he does not forfeit an additional $10 million in ill-gotten gains to the federal government, on top of assets already seized. He is also required to pay another $10 million if he does not serve his full prison sentence.

This development comes as Mashinsky serves a 12-year federal prison sentence for fraud and has separately been ordered to forfeit more than $48 million. The federal sentence is tied to his guilty plea in December 2024 to securities and commodities fraud charges.

In her announcement, James said that Mashinsky promised New Yorkers his company would be a safe place to invest their hard-earned savings, but left them with nothing after his high-risk investments collapsed.

Background on the case

According to the original lawsuit, Mashinsky promoted Celsius as a safer alternative to banks, offering returns of up to 17%, while allegedly concealing risky investments and mounting losses. By early 2022, Celsius had attracted about $20 billion in digital assets but struggled to generate enough revenue to support the returns it had promised, prompting it to pursue riskier investments, according to the Commodity Futures Trading Commission.

In June 2022, Celsius froze customer withdrawals, then filed for bankruptcy the following month, revealing a shortfall of more than $1 billion between its assets and liabilities. The New York Attorney General’s office said that, as of August 2026, more than $3.4 billion had been distributed to Celsius creditors through the bankruptcy proceedings.

Broader regulatory fallout

The New York settlement follows a series of other settlements and regulatory actions. In June, the Commodity Futures Trading Commission permanently barred Mashinsky from trading and registering with the agency. In April, the Federal Trade Commission had already banned him from working in crypto and finance and ordered him to pay $10 million, alongside a $4.72 billion judgment, most of which was suspended.

The Securities and Exchange Commission also reached a preliminary agreement with him in September to resolve a separate civil lawsuit, before a federal judge dismissed the case without prejudice on September 29 pending completion of the settlement.

Since May, Mashinsky has been seeking to overturn his federal conviction and sentence, representing himself in the proceedings. Federal prosecutors opposed his motion in August, calling his arguments meritless, while the judge denied his request for additional documents. An order issued on October 5 left that decision in place. Mashinsky has until December 11 to respond to the government’s objections to his petition.

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