FTC fines Celsius founder Mashinsky $4.7B, bans him for life

A New York judge approved the Federal Trade Commission’s civil order that imposes a $4.7 billion penalty on Alexander Mashinsky and bars him permanently from conducting crypto or traditional financial services.

Most of the $4.7 billion is suspended. Mashinsky must make a $10 million payment immediately, which can be satisfied with funds already tied to a separate forfeiture order. Regulators can reinstate the full penalty if they later find he concealed assets or failed to disclose financial information.

The civil figure mirrors roughly $4.7 billion in customer claims from Celsius Network’s 2022 collapse, when the platform froze withdrawals and later filed for bankruptcy. The FTC’s order preserves claims tied to total customer losses and keeps pressure on any remaining assets that may be recovered.

The civil sanction is additional to Mashinsky’s criminal sentence. He pleaded guilty to commodities fraud and to manipulating the price of Celsius’s CEL token and is serving a 12-year prison term. Judge Denise Cote signed the FTC judgment in New York.

The ban prevents Mashinsky from promoting, offering or operating any service that accepts deposits, offers investments or transfers assets. The restriction covers both crypto businesses and traditional financial services. The order also imposes reporting and compliance obligations for as long as 18 years.

A recovery effort involving creditors and other claimants remains active. A consortium backed by VanEck and GXD Labs reported that stablecoin issuer Tether agreed to pay nearly $300 million to settle certain claims tied to the Celsius collapse. The FTC order does not immediately change bankruptcy distributions but preserves the regulator’s claim on customer losses.

Investor Anthony Pompliano described the penalty as a ‘warning shot’ and wrote that regulators are making clear misleading retail investors can end careers as well as firms. Macro investor Raoul Pal characterized the judgment as part of a broader push for accountability and said it helps rebuild confidence.