Former CEO Of Celsius Network, Alex Mashinsky, Will Undergo Trial In September 2024

Former CEO of Celsius Network, Alex Mashinsky. (Photo; Doc. Forkast News)

JAKARTA - The United States District Court for the Southern District of New York has set a criminal trial date for former Celsius Network CEO Alex Mashinsky, on September 17, 2024. At the time of the trial, Mashinsky will remain free with a guarantee of $40 million (Rp624 billion), although with some travel restrictions and financial transactions imposed.

In October, Judge John Koeltl held a hearing to set a trial date and schedule three pretrial conferences scheduled for March, July, and September. While the trial approached, the court had also frozen some of Mashinsky's assets, including his bank accounts and property.

Mashinsky faces a series of charges, including misleading Celsius investors and fraud related to the use of customer funds. Celsius Network, which filed for bankruptcy last year, has significant debts to investors. Allegations of increasing the value of the company's original tokens in an illegal manner also surfaced in this case.

Apart from Alex Mashinsky, Roni Cohen-Pavon, the former Celsius Chief Revenue Officer, also faces criminal charges and has pleaded guilty to four criminal charges. He will remain free on bail until a verdict hearing in December and is willing to testify at Mashinsky's trial next year.

SEC and CFTC lawsuits

Celsius Network is also faced with lawsuits from the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC). The SEC accused the company and Mashinsky of selling fraudulent and unregistered "crypto asset securities". In addition, the SEC also charged the two of them of misleading investors about Celsius' financial status and manipulating the price of the CEL token, which is the company's flagship token.

In parallel, the CFTC also filed allegations of fraud against Alex Mashinsky and Celsius. As a result, several assets belonging to Mashinsky, including property in Texas and their holdings in leading financial institutions such as Goldman Sachs, Merrill Lynch, and SoFi Bank, have been subject to freezing orders.

Although this legal issue is ongoing, Celsius creditors have hopes for an agreed restructuring plan. The plan ensures that they will receive compensation in the form of major cryptocurrencies such as Bitcoin and Ethereum. In addition, they will gain ownership shares in a new company entity called "NewCo."