TLDR
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Alexander Mashinsky receives a permanent ban from CFTC-regulated trading and registration activities.
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The ban follows his guilty plea to fraud charges linked to Celsius Network’s collapse.
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A U.S. court approved the CFTC order and entered it into the official docket.
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Mashinsky is already serving a 12-year prison sentence from the criminal case.
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The court imposed a $50,000 fine and ordered $48 million in restitution.
U.S. regulators have finalized enforcement action against Alexander Mashinsky, strengthening penalties tied to Celsius Network’s collapse. The Commodity Futures Trading Commission issued a permanent ban on his trading and registration activities. The decision follows earlier criminal sentencing and financial penalties tied to fraud charges.
CFTC Finalizes Permanent Restrictions on Mashinsky
The Commodity Futures Trading Commission formally barred Mashinsky from participating in regulated commodities markets. The agency confirmed the order in a statement released on Thursday.
The ruling prohibits Mashinsky from trading, registering, or seeking business under the regulator’s oversight. It also enforces a permanent injunction against future violations tied to commodities laws.
The order was filed in the U.S. District Court for the Southern District of New York. A judge approved the filing and entered it into the official court docket.
Regulators said the action aligns with earlier findings in criminal proceedings against Mashinsky. The agency described the ban as a standard outcome in enforcement resolutions involving fraud.
The CFTC stated that Mashinsky and Celsius misled customers about platform safety and financial stability. It added that the company presented inaccurate claims during its operational decline.
The regulator said, “Mashinsky and Celsius engaged in a scheme to defraud hundreds of thousands of customers.”
It also stated that customers were misled on profitability and compliance claims.
Prior Sentence and Financial Penalties Remain in Effect
Mashinsky previously pleaded guilty to fraud charges in federal court. Authorities sentenced him to 12 years in prison following the plea agreement.
The court also imposed a $50,000 fine alongside a restitution order totaling $48 million. These penalties reflect financial harm caused to Celsius customers.
Prosecutors argued that Mashinsky knowingly provided false assurances about asset safety. They stated that the company incurred significant losses while maintaining messaging to maintain public confidence.
Court filings indicated that Celsius continued to promote returns despite deteriorating financial conditions. Customers were told their assets remained secure and generated rewards.
The collapse occurred during a broader downturn in the digital asset sector in 2022. Several major firms failed during the same period, increasing market instability.
Celsius was among the companies that halted withdrawals before filing for bankruptcy protection. The shutdown locked customer funds and triggered widespread legal action.
Regulators emphasized that enforcement actions aim to address misconduct and protect market participants. They noted that court-approved orders provide long-term restrictions on violators.
The CFTC confirmed that no additional monetary penalties were added in the latest order. However, the permanent ban reinforces restrictions already imposed through criminal proceedings.
