New York Attorney General Letitia James has announced a settlement that imposes a permanent industry ban on Alex Mashinsky, the founder and former chief executive of collapsed crypto lender Celsius, barring him from participating in the cryptocurrency, securities, and commodities markets. The agreement resolves a 2023 civil lawsuit connected to Celsius's bankruptcy and adds up to $35 million in possible payments on top of the federal penalties Mashinsky has already received.

Mashinsky Faces Up to $35 Million Under New York Settlement

The settlement contains two significant financial conditions. If Mashinsky fails to turn over an additional $10 million in alleged ill-gotten gains to the federal government, he will be required to pay the $25 million fine imposed in New York. He could also owe an additional $10 million if he does not complete his prison term.

Because both payments are conditional, the final amount Mashinsky owes in New York hinges on two future outcomes: whether he surreers the $10 million to federal authorities and whether he completes his sentence.

The separate federal case is currently on hold after Mashinsky was sentenced to 12 years in prison. He was also ordered to pay more than $48 million in federal forfeiture.

Lifetime Ban Extends Across Crypto and Financial Markets

Under the New York settlement, Mashinsky is permanently barred from any involvement in the cryptocurrency, securities, and commodities businesses. The restriction adds a further layer of consequences stemming from the collapse of Celsius, once one of the largest lending platforms in the crypto industry.

The bar is a lifetime disqualification rather than a time-limited suspension, meaning it remains in effect well beyond Mashinsky's 12-year prison term.

New York officials charged Mashinsky with improper registration and with misleading investors about the company's financial condition and its handling of customer investments.

Investors Were Told Celsius Was Safer Than Banks

Celsius attracted users by offering interest payments on their cryptocurrency deposits. Mashinsky served as the public face of the platform, regularly appearing on television and social media to promote Celsius.

According to the announcement, he repeatedly told New York investigators that Celsius was a safer way to invest than traditional banks and described the company's investment approach as low-risk.

Authorities further alleged that customer funds were placed into risky ventures that produced losses of hundreds of millions of dollars, with those losses concealed from investors. The lawsuit covered hundreds of thousands of Celsius users, including more than 26,000 investors in New York. The attorney general's full announcement is available on the official NY AG website.

Creditors Have Received More Than $3.4 Billion

Celsius froze customer withdrawals in 2022 as it moved into bankruptcy, leaving users unable to access their funds on the platform. As of August 2026, bankruptcy proceedings have distributed more than $3.4 billion to creditors. Separately, Celsius executives and founders were required to pay $16.5 million to the Federal Trade Commission. Those recoveries came through bankruptcy and regulatory channels rather than through the New York settlement, whose payments take the form of a fine and disgorgement to government authorities.

The New York settlement brings to a close a sweeping enforcement effort following the lender's collapse, while ensuring Mashinsky remains shut out of regulated cryptocurrency and mainstream financial markets.