Fraud trial of former CEO of Celsius
Date: 2023-10-05 Author: Dima Zakharov Categories: IN WORLD
The legal battle concerning the criminal charges of fraud against Alex Mashinsky, the former CEO of the cryptocurrency lending platform Celsius, is set to take place on September 17, 2024. Bloomberg reports that during preliminary hearings in a U.S. district court, Mashinsky's legal team hinted at a defense strategy that questions whether cryptocurrency should be considered a security.
"Legal definitions of what constitutes a security can be fluid," stated Robert Frenchman, a member of Mashinsky's defense team.
In January 2023, the New York Attorney General's office accused Mashinsky of defrauding investors "out of billions of dollars," leading to his arrest in July of the same year.
During the same month, the U.S. Department of Justice filed seven additional criminal charges against the former CEO of Celsius and the platform itself. These charges include securities fraud, price manipulation of the CEL token, misleading investors, and conspiracy to defraud clients.
Mashinsky has not pleaded guilty to any of the charges against him. He was later released on bail set at $40 million. In September, the court decided to freeze Mashinsky's assets for the duration of the trial.
What Happened to Celsius (CEL)?
To recap, in June 2022, Celsius suspended withdrawals, exchanges, and transfers between accounts citing "extreme market conditions."
After filing for bankruptcy, Celsius reported a balance sheet deficit of $1.2 billion. In August, it was revealed that the company's liabilities exceeded its assets by $2.85 billion.
In September, Alex Mashinsky stepped down as CEO.
