Crypto Community Divided as Former Celsius CEO Awaits Sentencing
Mashinsky Faces Up to 20 Years Behind Bars Amid Calls for Justice and Clemency
Alex Mashinsky, the former CEO of Celsius Network, will appear in a U.S. federal court on May 8 to be sentenced for commodities fraud and orchestrating a fraudulent scheme to manipulate the price of Celsius’ token. His case, unfolding in the Southern District of New York (SDNY), has sparked fierce debate among crypto users—some demand severe punishment, while others argue for a measured response.
In a May 2 court filing, prosecutors released additional victim impact statements, some arriving after the original deadline. Many Celsius users recounted devastating financial losses following the platform’s bankruptcy, with emotions running high over how justice should be served.
“Many of the people who participated in this fraud will get away with zero legal consequences,” wrote Daniel Frishberg from Florida. “Please do not allow Mr. Mashinsky to be one of those people… Throw the book at him.”
Prosecutors have requested a sentence of up to 20 years, while Mashinsky’s legal team is asking for one year and one day—a stark contrast that underscores the emotional and financial toll Celsius’ collapse has left in its wake.
Calls for Both Accountability and Restraint
Not all crypto users support a lengthy prison term. Artur Abreu, in his letter, acknowledged the harm Celsius caused, particularly to Bitcoin holders and borrowers, but described Mashinsky as sometimes acting as a “more conservative voice in an industry overflowing with unchecked greed.”
Meanwhile, Rachel Wolfson, host of the Web3 Deep Dive podcast and a former Cointelegraph reporter, voiced her support for a long sentence. Having lost $5,000 worth of Bitcoin, she believes that “harsh punishment for bad actors in the crypto industry has become necessary” to legitimize the space and deter future misconduct. She even noted that some victims reportedly died by suicide following their losses.
A Defining Moment for U.S. Crypto Enforcement
Mashinsky’s sentencing will be among the first major crypto rulings under Jay Clayton, the interim U.S. Attorney for SDNY and former SEC chair under President Trump. Critics have questioned whether Clayton’s Wall Street ties might lead to lighter enforcement, but his recent statement in support of a $12 million crypto fraud case suggests he may favor firm accountability.
His decision in this case could become a defining precedent for crypto regulation and justice in the U.S., especially following the recent 25-year sentence handed to FTX founder Sam Bankman-Fried.
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