Alex Mashinsky Celsius Settlement, New York Secures Up to $35 Million and a Permanent Crypto Industry Ban

New York has secured a settlement requiring former Celsius Network CEO Alex Mashinsky to pay up to $35 million under specified conditions and permanently barring him from the securities, commodities and cryptocurrency activities covered by the court order. The agreement was filed on October 8, 2026, in New York County Supreme Court, and announced by New York Attorney General Letitia James on October 9, 2026.

There is no consumer claim form and no claim deadline for this settlement. This is a government enforcement action against one individual, not a consumer class action. The money is payable to the State of New York under conditions written into the order. It is not a fund that Celsius customers can claim from. Celsius customers and creditors have recovered money mainly through the company’s bankruptcy, where more than $3.4 billion had been distributed as of August 2026.

Quick Facts: Alex Mashinsky’s New York Settlement

Detail	Verified information
Defendant	Alex Mashinsky, co-founder and former CEO of Celsius Network
Plaintiff	The People of the State of New York, through Attorney General Letitia James
Settlement amount	Up to 35millioninconditionalpaymentstoNewYork(25 million damages + $10 million monetary judgment)
Who receives the money	State of New York, not a consumer claims fund
Industry restriction	Permanent ban on securities, commodities and cryptocurrency business activities
Court	Supreme Court of the State of New York, New York County (Hon. Anar Rathod Patel, A.J.S.C.)
Case name and number	People of the State of New York v. Alex Mashinsky, Index No. 450040/2023
Original lawsuit filed	January 5, 2023 (amended complaint March 27, 2023)
Consent order filed	October 8, 2026
Public announcement	October 9, 2026
Official settlement website	None. This is not a claims-administered settlement.
Claim form link	None. No claim form exists.
Consumer claim deadline	None
Related recovery for Celsius users	Celsius bankruptcy distributions (more than $3.4 billion as of August 2026)
Separate criminal sentence	144 months (12 years) in federal prison
Official announcement	New York Attorney General press release
Official settlement document	Consent Order and Judgment (PDF)

The $35 million figure is conditional. The order contains a $25 million damages obligation tied to a federal forfeiture-payment condition, and a separate $10 million monetary judgment tied to service of Mashinsky’s criminal sentence. It should not be read as $35 million already received by New York.

What Is the Alex Mashinsky Celsius Settlement About?

The settlement resolves Attorney General Letitia James’s civil enforcement action against Mashinsky, who co-founded and led Celsius Network, a cryptocurrency lending platform.

Celsius let customers deposit digital assets through products such as its Earn Interest Accounts, which paid interest on crypto holdings. Mashinsky publicly promoted the platform and made statements about its safety, financial condition and investment practices.

According to the Attorney General, Mashinsky misled investors about Celsius’s safety, user numbers and investment strategies. The state alleged he encouraged deposits by portraying Celsius as safer than a bank while concealing losses from high-risk strategies, misrepresenting the company’s regulatory status, and failing to register as a securities dealer or salesperson and a commodities broker-dealer or salesperson as New York law requires.

The Attorney General’s office said the conduct affected hundreds of thousands of investors, including more than 26,000 in New York. Celsius froze withdrawals in June 2022 and filed for bankruptcy the following month, after attracting roughly $20 billion in digital assets at its peak. The state cited individual examples, including a New York resident who mortgaged two properties and a disabled veteran who lost $36,000 saved over nearly a decade.

The lawsuit also challenged the offering and sale of Celsius’s CEL token. In the consent order, Mashinsky admitted violating the Martin Act and Executive Law § 63(12). The admissions concern false and misleading statements about Celsius’s regulatory approval and material misstatements and omissions about his sales of CEL tokens. He is also prohibited from publicly denying those findings.

The result is a set of legal restrictions and monetary obligations. It does not create an application process through which former Celsius customers can receive a share of $35 million.

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Who Is Eligible for the $35 Million Settlement?

No consumer class exists for this settlement. The case was brought by the State of New York against Mashinsky, and the monetary relief runs to the state.

• Former Celsius Earn customers: The New York settlement provides no new claim form for them.
• CEL token investors: The agreement addresses alleged misconduct involving CEL but creates no CEL-investor claims process.
• Bitcoin and other crypto holders: Holding crypto on Celsius does not, by itself, make someone eligible to claim from this settlement.
• Celsius bankruptcy creditors: Their rights and distributions arise under the separate bankruptcy proceedings.
• Investors who have not received a bankruptcy distribution: They should review official bankruptcy claims and distribution information, not file anything with New York under this settlement.

The $3.4 billion in distributions reported by the Attorney General relates to the bankruptcy process. It is not a payout from the state’s settlement with Mashinsky.

How to Check for Celsius Bankruptcy Payments or Unresolved Claims

Although this settlement has no claim form, former Celsius customers may still need to check the status of their bankruptcy claims or distributions.

Step 1: Gather your records. Collect account statements, transaction histories, claim notices, emails from the bankruptcy administrator and records of crypto held on the platform.

Step 2: Check official bankruptcy information. Use the official bankruptcy court docket and authorized claims or distribution channels. Celsius filed its Chapter 11 case in the U.S. Bankruptcy Court for the Southern District of New York, and court filings can be found through PACER, the federal judiciary’s electronic records system. Confirm that any instructions come from an authorized source.

Step 3: Verify whether a distribution was issued. Review distribution notices and payment records tied to your claim. If you believe a payment was missed, follow the administrator’s documented inquiry process. Do not assume the New York settlement reopens a bankruptcy claim or creates a right to another payment.

Step 4: Watch for scams. A website promising an automatic share of the $35 million settlement is not supported by the state’s announcement. Never give out wallet recovery phrases, private keys or passwords, and never send upfront crypto payments to anyone offering to release settlement money.

How the $35 Million in Monetary Relief Works

The consent order divides the potential monetary obligations into two parts.

1. The $25 Million Damages Obligation

Mashinsky owes New York $25 million in damages. This obligation is deemed satisfied if he makes a qualifying $10 million payment to the U.S. Department of Justice under the federal forfeiture order. Qualifying payments made to the DOJ after May 20, 2025 receive dollar-for-dollar credit toward that $10 million. If the federal payment condition is not met as specified, the full $25 million becomes due to the New York Attorney General’s Office.

2. The Separate $10 Million Monetary Judgment

The order also imposes a $10 million monetary judgment payable to New York. It is deemed satisfied if Mashinsky completes his full criminal prison sentence as ordered. The order carves out exceptions, so the $10 million can become due in circumstances such as:

• A court-ordered reversal or reduction of the sentence, including a successful petition under 28 U.S.C. § 2255
• Compassionate release under 18 U.S.C. § 3582(c)(1)(A)
• Certain good-time or earned-time credits
• Early release under the First Step Act
• Certain Bureau of Prisons home-confinement programs

Why the Distinction Matters

The combined maximum exposure to New York is $35 million, but these are backstop obligations tied to federal compliance. They are not an immediate $35 million payment into a victim fund. The amount New York ultimately collects depends on how these conditions play out. The federal forfeiture of $48,393,446 is a separate obligation under a separate order and should not be added to the New York figures or described as one consumer fund.

The Permanent Industry Ban: What Mashinsky Can No Longer Do

The order goes beyond money. Except for his own personal purchases or sales, Mashinsky is permanently barred from:

• Issuing, selling, exchanging, purchasing, offering, promoting or distributing securities and commodities, including cryptocurrency and digital assets.
• Operating or working in a securities or commodities business as a broker, dealer, issuer, salesperson, investment adviser, investment manager, officer, director, controlling person, consultant or similar covered role.
• Giving paid investment advice or communications about buying or selling securities, commodities, cryptocurrency or digital assets.
• Forming or assisting any entity that solicits investors in securities, commodities or cryptocurrency.
• Any activity requiring registration under New York General Business Law Article 23-A, the Banking Law or the Financial Services Law.

He must also cooperate with the Attorney General’s office, including by providing records and truthful testimony in investigations and actions as the order requires. The court retains jurisdiction to enforce the order.

The ban is broader than a prohibition on running Celsius again. It limits his participation in covered roles at any business. It is a New York court order framed around securities, commodities and crypto activity, and its exact scope is governed by the order’s text, not by headlines. It exists alongside the federal and regulatory bans described below.

Which Laws Were Involved in the Celsius Case?

New York General Business Law Article 23-A (The Martin Act)

The Martin Act, GBL §§ 352 and following, is New York’s securities and commodities fraud statute. It gives the Attorney General broad power to investigate fraudulent practices and seek injunctions, disgorgement, damages and industry bars. Unlike many private securities claims, a Martin Act case generally does not require proof of fraudulent intent or investor reliance. Courts have also held that the Martin Act itself gives private individuals no right to sue, which is why enforcement runs through the Attorney General.

New York Executive Law § 63(12)

This provision authorizes the Attorney General to pursue repeated or persistent fraudulent or illegal conduct in carrying on a business. The order bars Mashinsky from conduct violating this section or the Martin Act.

Registration Requirements for Securities and Commodities Dealers

New York requires securities and commodities dealers, brokers and salespersons to register under Article 23-A, including GBL § 359-e. The state alleged Mashinsky acted without required registration. The settlement does not mean every crypto transaction needs registration. The requirement depends on the activity, the person’s role, the product and the applicable law.

New York CPLR § 2222

The order states that the Attorney General may docket it as a judgment against Mashinsky under CPLR § 2222 and enforce it. This supports collection of the monetary judgment. It does not create a consumer claims process.

Federal Statutes Behind the Parallel Cases

The federal criminal case, United States v. Mashinsky, No. 23-CR-347 (JGK) (S.D.N.Y.), involved commodities fraud and a fraudulent scheme to manipulate the price of CEL. Related federal sentencing and release provisions appear in the New York order’s conditions: 28 U.S.C. § 2255, 18 U.S.C. § 3582(c)(1)(A) and the First Step Act. Celsius’s bankruptcy proceeds under Chapter 11 of the U.S. Bankruptcy Code.

How the New York Case Differs From the Federal Criminal Case

Issue	New York civil case	Federal criminal case
Authority	People of the State of New York, through the Attorney General	U.S. Department of Justice
Court	N.Y. Supreme Court, New York County	U.S. District Court, S.D.N.Y.
Case number	Index No. 450040/2023	23-CR-347 (JGK)
Legal basis	Martin Act and Executive Law § 63(12)	Commodities fraud and a fraudulent scheme involving CEL
Resolution	Consent order and judgment filed October 8, 2026	Guilty pleas and sentence
Money	Up to $35 million, conditional	$48,393,446 criminal forfeiture
Prison	Not imposed by the civil settlement	144 months (12 years)

Mashinsky pleaded guilty in December 2024. On May 8, 2025, the federal court sentenced him to 144 months in prison and ordered forfeiture of $48,393,446. He is currently serving that sentence.

Other Regulatory Actions Against Mashinsky and Celsius

Other agencies have also acted against Celsius and its executives. These are distinct from the New York case, and readers should verify current details on the agencies’ own sites.

• CFTC: A consent order with a permanent injunction and trading and registration bans was reported around June 2026.
• FTC: Separate settlements totaling $16.5 million with Mashinsky and other Celsius founders and executives, resolving claims of deception about deposit safety, insurance, reserves and yields. Mashinsky’s share was reported as $10 million.

The New York order adds a state-level permanent bar and a conditional monetary backstop on top of the federal conviction and these regulatory resolutions. It also shows New York’s continued use of the Martin Act against crypto platforms and executives.

Timeline: Alex Mashinsky and the Celsius Legal Proceedings

Date	Event
June 2022	Celsius froze customer withdrawals
July 2022	Celsius filed for bankruptcy
January 5, 2023	New York Attorney General filed the civil lawsuit
March 27, 2023	Amended complaint filed
August 4, 2023	Court denied Mashinsky’s motion to dismiss
September 12, 2023	Mashinsky filed his answer
December 2024	Federal plea agreement and guilty pleas
May 8, 2025	Federal sentence of 144 months and $48,393,446 forfeiture
August 2026	More than $3.4 billion distributed to Celsius creditors (per the Attorney General)
October 8, 2026	Stipulation and Consent Order filed
October 9, 2026	Attorney General announced the settlement and ban

Can Celsius Customers Still Pursue Compensation?

The consent judgment does not extinguish the rights of non-parties. The order expressly preserves them. Private claims by individuals are therefore not wiped out by this settlement. At the same time, the settlement does not create any new right to recover losses from Mashinsky or Celsius.

Whether an individual has any remaining option depends on the nature of the claim, the status of the bankruptcy, prior releases, applicable court orders and whether the claim has already been resolved. Anyone who believes they have an individual claim should consult a licensed attorney. A customer who thinks a bankruptcy distribution was miscalculated or missed should start with the bankruptcy documents and deadlines. Suspected ongoing crypto fraud can be reported to the New York Attorney General’s Investor Protection Bureau.

For background on a different Celsius-related dispute, see our article on the Flo Rida lawsuit and the $82.6 million Celsius breach of contract case. That case involves Celsius Holdings, the energy-drink company, not Celsius Network, the crypto platform in Mashinsky’s case. They are different companies.

Frequently Asked Questions About the Alex Mashinsky Celsius Settlement

Is there a claim form or deadline for the Alex Mashinsky settlement?

No. The order creates no consumer claims program, so there is no claim form and no deadline. Payments, if any, go to the State of New York.

Will Celsius customers receive a share of the $35 million?

No. The New York order provides no automatic or claimable payments to customers. Customer recoveries come through the Celsius bankruptcy.

Does Mashinsky have to pay $35 million right away?

Not necessarily. The $25 million is deemed satisfied if he makes a qualifying $10 million payment to the DOJ, and the $10 million is deemed satisfied if he completes his prison sentence, subject to exceptions. If the conditions fail, the amounts become due to New York.

Is Mashinsky permanently banned from all cryptocurrency transactions?

He is permanently barred from covered securities, commodities and crypto business activities. The order expressly excepts his own personal purchases or sales.

Which laws did Mashinsky admit violating?

The Martin Act (GBL Article 23-A) and Executive Law § 63(12), through false and misleading statements about Celsius’s regulatory approval and material misstatements and omissions about his CEL sales.

Why is Mashinsky in prison for 12 years?

He pleaded guilty to federal commodities fraud and a fraudulent scheme to manipulate CEL’s price. He was sentenced to 144 months on May 8, 2025.

Is the New York settlement the same as the Celsius bankruptcy distribution?

No. The settlement resolves the state’s civil enforcement claims. Bankruptcy distributions come from a separate proceeding.

Does the ban apply only in New York?

It is imposed by a New York court order and framed broadly around securities, commodities and crypto activity. Separate federal and regulatory bans also exist.

Does this settlement stop individuals from suing?

No. The order preserves non-party rights. Anyone considering a claim should consult their own attorney.

Where can I read the official documents?

The Attorney General’s press release and the filed Consent Order and Judgment, both listed in the Sources section and in the Quick Facts table. The filing is also on the court’s NYSCEF docket for Index No. 450040/2023.

Disclaimer: This article provides general legal information and is not legal advice. AllAboutLawyer.com is an independent legal information website, not a law firm. The terms of the filed consent order control over any simplified description here. Facts are current as of the Attorney General’s announcement; verify the latest status on official dockets.

About the author: Researched and written by Israr Ahmad, legal content researcher at AllAboutLawyer.com. Coverage focuses on court filings, official government announcements, settlement documents and legal developments affecting consumers and investors.

Sources

1. New York Attorney General, Consent Order and Judgment, The People of the State of New York v. Alex Mashinsky, Index No. 450040/2023, filed October 8, 2026. https://ag.ny.gov/sites/default/files/settlements-agreements/new-york-v-alex-mashinsky-stipulation-2026.pdf
2. New York Attorney General, “Attorney General James Bans Former Cryptocurrency CEO Who Defrauded Investors from Financial Industry,” October 9, 2026. https://ag.ny.gov/press-release/2026/attorney-general-james-bans-former-cryptocurrency-ceo-who-defrauded-investors
3. New York Attorney General, “Attorney General James Sues Former CEO of Celsius Cryptocurrency Platform for Defrauding Investors,” January 5, 2023. https://ag.ny.gov/press-release/2023/attorney-general-james-sues-former-ceo-celsius-cryptocurrency-platform-defrauding
4. Federal court records, United States v. Mashinsky, No. 23-CR-347 (JGK), S.D.N.Y., and the Celsius bankruptcy docket, via PACER. https://pacer.uscourts.gov/