• New York Attorney General Letitia James has sued former Celsius Network CEO Alex Mashinsky for defrauding investors out of billions of dollars
• Celsius Network filed for Chapter 11 bankruptcy in July 2022, citing “extreme market conditions”
• Mashinsky reportedly withdrew $10 million from Celsius weeks before it stopped withdrawals
New York’s state attorney general Letitia James has announced that she is suing the former head of Celsius Network, Alex Mashinsky, for defrauding investors out of billions of dollars. The news comes as the once-buzzing crypto industry is fighting many legal battles, with FTX CEO Sam Bankman-Fried being one of the most prominent figures in these cases.
In July 2022, Celsius Network filed for Chapter 11 bankruptcy in the US Bankruptcy Court for the Southern District of New York. It was noted that this decision was made in an attempt to help the company stabilize and develop a restructuring plan. During this period, the CEO boasted of a solid and experienced team to help them through the restructuring process.
Unfortunately, just prior to filing for bankruptcy, Celsius halted customer withdrawals in June due to “extreme market conditions.” The CEO resigned shortly after, and it was discovered that he had withdrawn $10 million from Celsius weeks before the company stopped withdrawals.
This news has been met with shock and outrage from the crypto community. Attorney General Letitia James has been quick to take legal action against Mashinsky, citing his actions as “unconscionable” and “unacceptable.” She is determined to make sure that those who have been wronged by Mashinsky are compensated for their losses.
This case is yet another example of the risks and dangers of investing in cryptocurrency. While there are potential rewards to be gained, it is important for investors to be aware of the potential risks in order to make informed decisions.