Celsius Network founder bags 12-year jail term for crypto fraud

By: coinfea|2025/05/09 22:01:10

Celsius Network founder Alex Mashinsky has been sentenced to 12 years in prison for crypto fraud. Mashinsky barely escaped a 20-year jail term after calls for a longer term amid the damaging bankruptcy case, and his unrepentant behavior was made known.Mashinsky was sentenced to 12 years in prison for defrauding hundreds of thousands of investors. Celsius Network promised high returns, but wiped out over $7B in value. The final sentencing of 12 years includes charges of commodity and securities fraud. Mashinsky pleaded guilty in December 2024, leaving the court to determine the final length of the sentence. At one point, the plea was linked to a potential life sentence, capped at 30 years, court documents show.The sentence will begin from September 12, as Mashinsky begged the court for a delay to attend his daughter’s wedding, which was granted by Judge Koetl at the District Court of New York. The sentence will be served at the Federal Correctional Institution, Otisville. The emotions ran high during the sentencing, as Celsius was targeting retail investors and wiped out the personal savings of multiple depositors. Mashinsky himself reportedly cried during the final arguments and sentencing.Celsius Network founder to forfeit personal propertiesCelsius Network reportedly stopped withdrawals in June 2022, while later reporting exposure to the FTX exchange. On July 13, the company filed for Chapter 11 bankruptcy protection, ending the procedure in January 2024. According to reports, Celsius had up to $444M in assets on the bankrupt exchange. The chaos and insolvency procedures led to the prolonged bear market in 2022-2023, which wiped out even more investor value.Celsius Network raised red flags just before the first signs of insolvency, though Mashinsky denied it until the last day. Throughout the trial, Mashinsky still claimed he acted in good faith, though the defense still pointed out unrepentant statements, minimizing the gravity of the Celsius fraud.The platform was an early version of a crypto lending protocol, which was centralized and depended on constant inflows to service the high promised interest rates. The platform defrauded even high-profile crypto influencers, leading even more crypto users to root for the maximum possible sentence and eventual compensation.Meanwhile, Mashinsky will forfeit $48M of his funds and nine real estate properties to compensate Celsius Network depositors. Mashinsky’s defense admits to a loss of $590M, though other estimates show Celsius owes as much as $4.7B. Unfortunately, the platform lacks the funds to repay all creditors and has only distributed around $127M in the second phase of its compensation program.Total losses are about $7B, including the lost value from the project’s native token. The trial also called forward over 200 personal statements of wealth loss due to involvement with Celsius Network. Prosecutors pointed out the damaging effect of wiping out personal life savings, while demanding a maximum sentence.The post Celsius Network founder bags 12-year jail term for crypto fraud first appeared on Coinfea.

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Mixin has launched USTD-margined perpetual contracts, bringing derivative trading into the chat scene.

The privacy-focused crypto wallet Mixin announced today the launch of its U-based perpetual contract (a derivative priced in USDT). Unlike traditional exchanges, Mixin has taken a new approach by "liberating" derivative trading from isolated matching engines and embedding it into the instant messaging environment.

Users can directly open positions within the app with leverage of up to 200x, while sharing positions, discussing strategies, and copy trading within private communities. Trading, social interaction, and asset management are integrated into the same interface.

Simplified Trading Experience: No KYC Required, Opening a Position in Five Steps

Based on its non-custodial architecture, Mixin has eliminated friction from the traditional onboarding process, allowing users to participate in perpetual contract trading without identity verification.

The trading process has been streamlined into five steps:

· Choose the trading asset

· Select long or short

· Input position size and leverage

· Confirm order details

· Confirm and open the position

The interface provides real-time visualization of price, position, and profit and loss (PnL), allowing users to complete trades without switching between multiple modules.

Social-Native Trading: Strategy and Execution Completed in the Same Context

Mixin has directly integrated social features into the derivative trading environment. Users can create private trading communities and interact around real-time positions:

· End-to-end encrypted private groups supporting up to 1024 members

· End-to-end encrypted voice communication

· One-click position sharing

· One-click trade copying

On the execution side, Mixin aggregates liquidity from multiple sources and accesses decentralized protocol and external market liquidity through a unified trading interface.

By combining social interaction with trade execution, Mixin enables users to collaborate, share, and execute trading strategies instantly within the same environment.

Referral Mechanism: Non-institutional users can receive up to 60% fee split

Mixin has also introduced a referral incentive system based on trading behavior:

· Users can join with an invite code

· Up to 60% of trading fees as referral rewards

· Incentive mechanism designed for long-term, sustainable earnings

This model aims to drive user-driven network expansion and organic growth.

Self-Custody Architecture and Built-in Privacy Mechanism

Mixin's derivative transactions are built on top of its existing self-custody wallet infrastructure, with core features including:

· Separation of transaction account and asset storage

· User full control over assets

· Platform does not custody user funds

· Built-in privacy mechanisms to reduce data exposure

The system aims to strike a balance between transaction efficiency, asset security, and privacy protection.

A New Path for On-Chain Derivatives

Against the background of perpetual contracts becoming a mainstream trading tool, Mixin is exploring a different development direction by lowering barriers, enhancing social and privacy attributes.

The platform does not only view transactions as execution actions but positions them as a networked activity: transactions have social attributes, strategies can be shared, and relationships between individuals also become part of the financial system.

Regulatory Background

Mixin's design is based on a user-initiated, user-controlled model. The platform neither custodies assets nor executes transactions on behalf of users.

This model aligns with a statement issued by the U.S. Securities and Exchange Commission (SEC) on April 13, 2026, titled "Staff Statement on Whether Partial User Interface Used in Preparing Cryptocurrency Securities Transactions May Require Broker-Dealer Registration."

The statement indicates that, under the premise where transactions are entirely initiated and controlled by users, non-custodial service providers that offer neutral interfaces may not need to register as broker-dealers or exchanges.

About Mixin

Mixin is a decentralized, self-custodial privacy wallet designed to provide secure and efficient digital asset management services.

Its core capabilities include:

· Aggregation: integrating multi-chain assets and routing between different transaction paths to simplify user operations

· High liquidity access: connecting to various liquidity sources, including decentralized protocols and external markets

· Decentralization: achieving full user control over assets without relying on custodial intermediaries

· Privacy protection: safeguarding assets and data through MPC, CryptoNote, and end-to-end encrypted communication

Mixin has been in operation for over 8 years, supporting over 40 blockchains and more than 10,000 assets, with a global user base exceeding 10 million and an on-chain self-custodied asset scale of over $1 billion.

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