TL;DR
- Over 200 victims submitted statements describing the financial and emotional harm caused by Celsius and its former CEO, Alex Mashinsky.
- The U.S. prosecution is requesting a sentence of up to 30 years, while victims denounce deliberate deception.
- The case has sparked a broader debate about trust in centralized platforms within the crypto ecosystem.
Alex Mashinsky, founder and former CEO of Celsius Network, faces a crucial sentencing hearing on May 8. U.S. federal prosecutors have gathered over 200 victim statements, detailing how thousands of people lost their life savings, suffered family stress, and saw their retirement plans collapse due to the platform’s downfall and ongoing legal battle.
Before its fall in July 2022, Celsius promised high returns for crypto deposits while offering loans backed by those digital assets. Many saw Celsius as a legitimate opportunity to generate passive income within a decentralized financial world. However, evidence indicates that Mashinsky and other top executives hid the company’s true financial condition until it was far too late, misleading investors continuously.
Painful Testimonies and Claims of Widespread Deception
Several testimonies describe how Celsius employees reassured users that their funds were “safe,” even on the very day withdrawals were frozen. The letters presented to the court reveal recurring themes: promises of transparency, misleading reassurances, and trust that ultimately ended in disaster. One investor said he lost more than seven million dollars and is now being sued by Celsius for withdrawing some funds before the crash, which he sees as deeply unfair and emotionally draining.
Other victims directly accuse Mashinsky of fostering a “culture of lying,” favoring internal employees who managed to withdraw their funds while the general public was encouraged to hold theirs. The overwhelming frustration has led many to demand the full 30-year sentence for the executive. Some even mentioned the need for future collective reparations to address the widespread damage caused.
A Wake-Up Call and a Defense of Real Crypto
Although this scandal has been used by crypto skeptics to delegitimize the entire sector, many within the community view the case as a chance to distinguish between centralized platforms that only appear to be crypto-based, and true decentralized solutions built on open code, transparency, and community values.
Celsius didn’t fail because of blockchain technology, but due to traditional business practices disguised as innovation.
Mashinsky will soon face his verdict. The crypto community demands justice, but also a clear lesson: crypto isn’t the problem, people using it unethically are.
