Celsius Network founders ordered to pay $16.5 million over claims that deposits were safer than banks
Alex Mashinsky and two co-founders of the collapsed crypto lender agreed to pay a combined $16.5 million and accept bans on selling deposit and asset-transfer products, the FTC said.
The three founders of Celsius Network have been ordered to pay a total of $16.5 million to resolve Federal Trade Commission charges that they falsely promised customer deposits were safe, the agency announced on July 20, 2026. The orders were entered in the US District Court for the Southern District of New York and allocate $10 million to Alex Mashinsky, $4.1 million to Shlomi Daniel Leon and $2.4 million to Hanoch Goldstein.
The FTC’s complaint, filed in July 2023, alleged that Celsius marketed itself as safer than a bank, claiming $750 million in insurance and advertising the Earn program’s annual yields of up to 18%. According to the agency, the company misled customers into believing it generated returns without risk by making collateralized loans to other exchanges, and falsely claimed that deposits could be withdrawn at any time, that it held sufficient reserves and that it made no unsecured loans. The FTC said the founders maintained that deposits were safe until days before the company filed for bankruptcy.
The orders bar Mashinsky and Leon from selling any product or service involving depositing, exchanging, investing or withdrawing assets, and bar Goldstein from selling retail products or services involving buying, selling, depositing, withdrawing, distributing or trading cryptocurrency. Mashinsky and Leon are also prohibited from disclosing consumers’ nonpublic personal information without express consent.
The Commission voted 3-0 to approve the settlement with Mashinsky, which was cleared before the departure of former Commissioner Melissa Holyoak, and 2-0 on each of the settlements with Leon and Goldstein. The FTC said the matters were handled by Stephanie Liebner, Carlton Mosley and Sally Tieu. The stipulated orders take legal effect when approved and signed by the district court judge.