The founder and former CEO of the Cryptocurrency Lending Platform Celsius Network has received a 12-year prison sentence. Prosecutors characterized him as having exploited vulnerable clients.
Alexander Masski, aged 59, was sentenced by US District Judge John G. Kortle. The judge described the crime as very serious, noting that many clients lost everything and suffered significant psychological distress, while Masski profited over $45 million.
Celsius filed for bankruptcy in 2022, revealing risky financial decisions concerning the $20 billion invested by numerous customers. Masski had assured clients that their funds were safe within Celsius, which had positioned itself as a modern banking alternative for cryptocurrency assets.
In defending Masski, lawyers attributed the collapse of Celsius to the tumultuous downturn in the cryptocurrency market during May and June 2022, arguing that his actions weren’t exploitative or predatory.
However, Assistant U.S. Attorney Aide Allison Nichols painted Masski as a financial predator, alleging that he misled clients from the outset by exaggerating the company’s momentum.
“He preyed on hope,” she stated, emphasizing that Masski was fully aware of his deceptive actions. She argued that clients are unlikely to be fully reimbursed, even through bankruptcy recovery processes.
Before his sentencing, Masski expressed remorse to his clients, crying as he reflected on his difficult past, which included escaping a small Ukrainian town at the age of seven.
Following their escape, his family relocated to Israel, where Masski served for three years as a fighter pilot in the Israel Defense Forces before moving to the U.S.
“I never intended to hurt anyone in this country,” said Masski. “I truly am sorry.”
When he pleaded guilty in December, Masski acknowledged that misleading investments had been made during the period from 2018 to 2022, contributing to Celsius’s profitability while putting clients’ funds at risk.
His attorney, Mark Mukassey, claimed that the victim impact statements presented during the hearing were quite harsh towards Masski.
“We understand the depth of their pain,” he commented, indicating their sympathies towards the victims.
Several victims shared their stories during the sentencing hearing.
Cameron Cruz, a member of the victims’ committee, called for a severe sentence, noting that nearly 250 victims had passed away without seeing justice or adequate compensation for their losses.
“Many people have been devastated,” he remarked.
U.S. Attorney Jay Clayton highlighted that Masski “earned tens of millions while his clients lost billions.”
He added, “American investors deserve better. While the areas of tokenization and digital assets are promising, that does not allow for deceit. The laws against fraud still apply.”
