Ex-Celsius CEO Alex Mashinsky Loses It All: Zero Claims to Bankruptcy Payouts
Another crypto king dethroned—this time with no golden parachute.
Alex Mashinsky, the ousted CEO of bankrupt crypto lender Celsius, just got a brutal reality check from the courts. His last-ditch grasp at recovery funds? Denied. Zeroed out. Gone.
No soft landing for this 'visionary'
While Celsius creditors scramble for scraps, Mashinsky joins the growing graveyard of crypto execs who mistook leverage for genius. The judge's ruling strips him of any claim to remaining assets—poetic justice for a platform that promised yields too good to be true.
Bonus burn: At least he won't need to worry about capital gains taxes on those phantom profits.
Road to recovery
Celsius filed for Chapter 11 bankruptcy protection in July 2022, following a liquidity crisis that exposed the platform's risky lending practices. The company reached two settlements to exit bankruptcy proceedings a year later, transitioning to a recovery-focused entity dedicated to maximizing creditor returns.
Last month, Mashinsky was sentenced to 12 years in federal prison for defrauding Celsius customers and manipulating the price of the CEL token.
At the time, prosecutors said he used customer funds to enrich himself and repeatedly misled investors about the company’s financial health.
Prosecutors had sought a 20-year sentence, which Mashinsky's lawyers characterized as a "death-in-prison sentence," arguing his military service and December guilty plea warranted leniency.
By August 2024, over $2.5 billion had been distributed to around 251,000 creditors across several payout rounds, covering 93% of total claims including nearly two-thirds of eligible creditors from 165 countries.
Still, according to the August 2024 court filing, roughly 121,000 eligible creditors have yet to claim their funds, most of whom are owed less than $100.
