New York Attorney General Letitia James has barred former Celsius Network chief executive Alex Mashinsky from the securities, commodities and cryptocurrency industries for life, attaching a $35 million penalty that the state will collect only if he breaks the federal plea deal that already put him in prison.

James sued Mashinsky in 2023 over claims that he misled hundreds of thousands of depositors, including more than 26,000 New Yorkers, about how safe their money was on the crypto lending platform. The arrangement ties the state's financial penalty entirely to whether Mashinsky honors the commitments he made in federal court.

How New York's $35 million penalty works

Per the attorney general's office, the $35 million figure splits into two conditional payments.

Under the first condition, if Mashinsky fails to forfeit $10 million in ill-gotten gains to the federal government, on top of assets already surrendered, he will owe the state $25 million. The other $10 million, which brings the total to $35 million, comes into play only if he does not serve his full prison term.

Mashinsky's federal plea already carries a forfeiture order of $48,393,446, according to the court stipulation filed in the case. If he forfeits that amount and completes his sentence, nothing goes to New York. For the state to receive any portion of the penalty, Mashinsky would have to default on commitments he made to avoid a longer sentence.

Another lifetime ban for a man already behind bars

This is not the first lifetime restriction imposed on Mashinsky. The Federal Trade Commission (FTC) entered a suspended $4.7 billion judgment and required him to pay $10 million as part of the settlement, while imposing an 18-year reporting regime and cutting him off from crypto and financial services. Unlike the prison term, those restrictions have no end date, meaning they will still be in force long after his release.

In June, the Commodity Futures Trading Commission (CFTC) added permanent trading and registration bans through a court consent order.

Mashinsky is serving 144 months in prison, a 12-year sentence that was handed down in May 2025 after he pleaded guilty to commodities fraud and manipulating the price of Celsius's CEL token.

The SEC case that could add another lifetime ban

Mashinsky's accounts with regulators are not yet fully settled. The lawsuit the Securities and Exchange Commission (SEC) filed against him in July 2023 over an alleged unregistered securities offering and CEL price manipulation is still reportedly open.

The agency told a federal court it had "engaged in substantive settlement discussions" with him in late May. No agreement was reached, and the court granted another 60 days for talks to continue. How those talks end will determine whether a fourth lifetime ban — after New York's, the FTC's and the CFTC's — lands on Mashinsky, making the SEC case the remaining regulatory front to watch.

What Celsius customers have gotten back

The events behind the series of rulings and lifetime bans began in June 2022, when Celsius froze withdrawals on its platform. A month later, the company filed for Chapter 11, wiping out deposits made by users who had treated it as a savings account. The collapse made Celsius one of the most prominent casualties of 2022's crypto credit crisis, a downturn in which several other major crypto lenders also failed the same year.

Since then, creditors have received more than $3.4 billion through the bankruptcy proceedings as of August 2026 — money that flows through the bankruptcy estate, a separate track from the penalties regulators have imposed on Mashinsky himself.

James said in a statement: "I will not allow scammers to use cryptocurrencies to prey on unsuspecting New Yorkers."