Former Celsius CEO Alex Mashinsky seeks lenient one-year sentence, disputes DOJ’s 20-year recommendation

Lawyers for Alex Mashinsky have asked a U.S. court to impose a sentence of no more than 366 days on the former Celsius CEO, who in December pleaded guilty to one count of commodities fraud and one count of manipulating the price of the CEL token. The motion was a final call for leniency and a response to the 20-year prison term suggested by US prosecutors last month.

The reply memorandum filed by Mashinsky’s legal team on May 5 criticized the government’s recommended punishment. Prosecutors said Mashinsky should spend 20 years in prison for defrauding customers of billions of dollars.

Mashinsky’s representatives described the prosecution’s sentencing memo as a “venom-laced submission” and a “death-in-prison” sentence. The ex-Celsius boss is 59 and would be released at over 79 if he served the full prison term.

According to the defense, federal prosecutors have attempted to scapegoat the former Celsius executive and “demonize” his character. They also ignored his status as a non-violent first-time offender, Mashinsky’s lawyers argued.

“The lion’s share of the vitriol relates to Alex’s unwillingness to capitulate to the government’s exaggerated characterizations of his actions,” his attorneys wrote. “But his voluntary plea of guilty and willingness to expose himself to thirty years in prison do not also require him to wholesale surrender to every unfounded accusation the government makes about his character, his motivations, his intent, or his family.”

“Nor is his guilty plea an admission to the elements of the remaining open counts; Alex did not plead guilty to wire fraud, which “contemplate[s] harm to the victim,” lawyers for the defense added.

The government initially charged Mashinsky with seven counts of criminal wrongdoing, including fraud and market manipulation. Mashinsky’s sentencing is scheduled for Thursday, May 8.

Celsius was one of a cast of crypto lenders that collapsed in the 2022 bear market. Before its bankruptcy, the company provided customers with centralized loans and interest-earning products.

A U.S. court approved Celsius’s reorganization plan in November 2023. The defunct lender later paid $2.5 billion to over 250,000 creditors in August 2024. Some of the firm’s holdings also started Ionic Digital, a bitcoin mining business.