CFTC Says Celsius and Former CEO Violated US Regulations

According to reports from Bloomberg citing people familiar with the matter, an investigation which was conducted by the Commodity Futures Trading Commission (CFTC) has concluded that Celsius, a prominent cryptocurrency financial services company, and its former Chief Executive Officer (CEO), Alex Mashinsky, violated multiple United States regulations before the company’s collapse in 2022.

The findings of the CFTC investigators shed light on a series of regulatory breaches committed by the defunct crypto lender under Mashinsky’s watch. These violations, which occurred prior to the company’s demise, have raised concerns about the platform’s compliance practices and their impact on the financial market. Additionally, the CFTC’s findings suggest a systemic failure within Celsius to adhere to the necessary legal requirements and safeguards.

Also, the CFTC investigators found out that Celsius misled many investors, failed to register with the regulator, and its CEO violated several regulations. However, if most CFTC commissioners agree with the investigator’s findings, the agency would probably file a case against the already collapsed company in a U.S. Federal Court before the month ends.

Meanwhile, the CFTC’s investigation into Celsius and its former CEO serves as a reminder of the importance of regulatory oversight in the financial industry.

CFTC has faulted Celsius for violating market laws

It highlights the need for robust compliance measures to ensure the integrity and stability of the market. Notably, the findings emphasize the significance of holding individuals and companies accountable for their actions, particularly when they directly impact investors and the broader financial ecosystem.

Celsius Network’s Woes Continue

Recall that earlier in the year, an independent U.S. court-appointed examiner also revealed that Celsius misled its investors and occasionally used new customer funds to pay for other customers’ withdrawals.

Likewise, the Securities and Exchange Commission (SEC), and Federal Trade Commission (FTC) have issued inquiries to the lender. Celsius had received a federal grand jury subpoena from the US District Court for the Southern District of New York and is facing intense regulatory scrutiny in “at least” 40 states.

In yet another interesting turn of events, a Twitter investigator who goes by the pseudonym ‘Coffeezilla’ alleged that the former CEO was still dumping enormous CEL tokens. The transactions were believed to have been executed from Mashinsky’s multiple wallets.