Alex Mashinsky
Alex Mashinsky is an Israeli-American technology entrepreneur and telecommunications and financial technology founder.[13] He co-founded ventures including the telecom exchange Arbinet and the crypto lending platform Celsius Network.[13] He was arrested in July 2023 on U.S. criminal fraud charges related to Celsius, later pleaded guilty, and in May 2025 was sentenced in the Southern District of New York to 12 years in prison with a substantial forfeiture order.[14][10] Through civil consent orders, regulators have imposed permanent trading and registration bans, a large monetary judgment, and broad industry bans arising from his conduct at Celsius.[18][19][20]
Early Life and Background
Alex Mashinsky was born in October 1965 in what was then the Ukrainian Soviet Socialist Republic, part of the Soviet Union.[13] In the 1970s his family emigrated to Israel, where he grew up before later moving to the United States as an adult.[15][16] Mashinsky holds Israeli-American nationality and has often been described as an Israeli-American entrepreneur in public profiles.[13]
Education
From 1987 to 1989, according to public biographies, Mashinsky studied economics at Tel Aviv University in a program reported as a Bachelor of Science degree.[1] Prior to that, from 1980 to 1982, he is reported to have studied electrical engineering at the Open University of Israel in a Bachelor-level program.[1]
Career
Arbinet and Early Telecom Ventures
In January 1995, he founded Arbinet, a telecommunications exchange for wholesale voice traffic. Arbinet later went public in 2004 and was subsequently acquired by Primus Telecommunications around 2010–2011.[17][13]
In August 1997, Mashinsky founded Comgates, a telecom softswitch company that was later merged into Telco Systems. Following this, in January 2001, he founded Elematics, which developed control panel software for optical telecom infrastructure.[9]
Governing Dynamics and GroundLink
In April 2004, Mashinsky established Governing Dynamics, an Israeli-American venture fund. The fund has been described as investing in technology-focused companies in sectors such as biotech, artificial intelligence, energy, and cybersecurity, with a focus on helping Israeli startups expand into the United States.[9]
Mashinsky then founded GroundLink in May 2005. GroundLink operated as an on-demand car service and ride-booking platform accessed via mobile app in multiple cities.[9]
Celsius Network
Mashinsky then co-founded Celsius Network in February 2017, a blockchain-based platform that offered interest-bearing accounts for deposited cryptocurrency assets and collateralized loans backed by those assets.[18][19] Under its Earn program, customers transferred crypto assets to Celsius in exchange for yield that was typically paid in kind or in Celsius’s CEL token, while a separate borrowing program issued fiat or stablecoin loans secured by customers’ crypto collateral.[18] Celsius used customer assets in part by rehypothecating them, deploying them into decentralized finance protocols and other investments as described in the bankruptcy and examiner filings, which later became central to regulatory and criminal proceedings.[18][20] By June 2022 the company reported approximately 1.7 million registered users and hundreds of thousands of active accounts worldwide, before pausing withdrawals on June 12, 2022 and filing for Chapter 11 bankruptcy on July 13, 2022; Mashinsky served as the founder and CEO of Celsius Network until September 2022.[21][22][9]
Inseego and Tellabs
He also served as the CEO and Board Member of Inseego Corp. (formerly Novatel Wireless, Inc) from April 2014 to November 2015, a company that provided wireless networking hardware and services. Additionally, he served as a Board Member of Tellabs from February 2013 to December 2013, serving on the board of directors.[9]
Legal Disputes
Lawsuit Allegations Against Celsius Network
In July 2022, Celsius Network faced a lawsuit filed by former investment manager Jason Stone, accusing the crypto lending platform of fraudulent activities and operating as a Ponzi scheme. Stone alleged that Celsius artificially inflated the price of its native digital coin, failed to implement proper risk management strategies, and used customer deposits to rig the value of its token. The lawsuit also claimed that Mashinsky enriched himself at the expense of depositors.[2][3]
Stone further alleged that Celsius failed to hedge against trading risks and had significant liabilities denominated in the cryptocurrency Ether without sufficient holdings to cover them. As a result, when customers attempted to withdraw their deposits, Celsius was forced to buy more ether at high prices, incurring heavy losses. The lawsuit characterized Celsius as a Ponzi scheme, accusing the company of resorting to offering double-digit interest rates to attract new depositors and repay earlier investors.[2][3]
Celsius faced additional scrutiny due to a liquidity crisis and the temporary suspension of withdrawals for its users. Stone's departure from Celsius in March 2021 was allegedly prompted by the company's unexplained balance sheet hole of $100 million to $200 million. The lawsuit claimed that Celsius continued to control an Ethereum wallet, which the CEO allegedly used for personal benefit, including transferring valuable non-fungible tokens to his wife's wallet.[2][3]
Lawsuits Against Celsius and Mashinsky
On July 13, 2023, a series of lawsuits were filed by various federal agencies, including the U.S. Department of Justice (DOJ), the Securities and Exchange Commission (SEC), the Federal Trade Commission (FTC), and the Commodity Futures Trading Commission (CFTC). These legal actions targeted both Celsius Network as a company and its former CEO, Alex Mashinsky.[4]
U.S. Department of Justice (DOJ) Lawsuit
The DOJ brought criminal charges against Mashinsky, including allegations of defrauding customers and pocketing $42 million. The indictment accused Mashinsky and other Celsius executives of orchestrating a scheme to inflate the value of Celsius' native token, CEL, in order to profit from its sale. Mashinsky's colleague, former chief revenue officer Roni Cohen-Pavon, was also charged in connection with these criminal activities.[4][5]
Securities and Exchange Commission (SEC) Lawsuit
The SEC filed a lawsuit against Celsius Network and Mashinsky, alleging that the company repeatedly lied to customers about the safety of its platform. The SEC claimed that Celsius made false statements regarding regulatory approvals, misrepresented its user base, and engaged in market manipulation. The complaint further accused Celsius of offering and selling unregistered securities through its lending program.[4][6]
Federal Trade Commission (FTC) Lawsuit
The FTC accused Celsius of deceiving consumers by misleading them into depositing their assets and subsequently mismanaging their investments. The FTC alleged that Celsius lied to investors, failed to maintain sufficient liquid assets for withdrawals, and falsely marketed itself as a safe alternative to traditional banking. The lawsuit named not only Celsius Network but also its co-founders Shlomi Daniel Leon and Hanoch "Nuke" Goldstein.[4][7]
Commodity Futures Trading Commission (CFTC) Lawsuit
The CFTC charged Mashinsky and Celsius Network with fraud and material misrepresentations related to the operation of Celsius' digital asset-based finance platform. The CFTC alleged that Celsius made false statements to customers and deceived them about the company's leverage. Mashinsky was specifically cautioned by Celsius senior management to cease making misleading statements.[4][8]
Consequences and Settlements
As a result of the criminal and regulatory actions, on May 8, 2025 Judge John Koeltl of the U.S. District Court for the Southern District of New York sentenced Alex Mashinsky to 12 years in prison following his December 2024 guilty plea to securities and commodities fraud charges related to Celsius Network. The sentence, which included approximately $48 million in forfeiture and the forfeiture of several real-estate assets, was significantly longer than the one year and one day requested by Mashinsky’s lawyers but shorter than the 20-year term sought by federal prosecutors; he subsequently reported in September 2025 to begin serving the sentence at a federal correctional facility in Otisville, New York.[10][17]
As part of a settlement with the U.S. Federal Trade Commission, reflected in a stipulated order entered by the U.S. District Court for the Southern District of New York in April 2026, Mashinsky was permanently banned from advertising, marketing, promoting, offering, or distributing any product or service that can be used to deposit, exchange, invest, or withdraw assets, whether directly or through an intermediary, and a $4.72 billion monetary judgment was entered against him, largely suspended subject to financial-disclosure conditions while requiring him to pay $10 million that may be credited against his criminal forfeiture obligations.[18][19]
On June 18, 2026, the U.S. District Court for the Southern District of New York entered a consent order resolving the Commodity Futures Trading Commission’s 2023 enforcement action against Mashinsky, permanently enjoining him from further violations of specified anti-fraud provisions of the Commodity Exchange Act and CFTC regulations and imposing permanent trading and CFTC registration bans.[20]
Mashinsky Held Responsible
In May 2026, after his prior counsel withdrew, Mashinsky filed a handwritten motion in the Southern District of New York seeking to vacate his 12-year sentence. Proceeding without his former lawyers, he argued that he had received ineffective assistance of counsel and alleged that undisclosed conflicts of interest arose from his former legal team’s work for FTX founder Sam Bankman-Fried, claiming those conflicts tainted strategic decisions and evidence in the case.[11][12] As of July 20, 2026, his FTC and CFTC civil cases had been resolved by consent orders imposing permanent bans and monetary obligations, his criminal conviction and 12-year sentence remained in place, and his motion to vacate was pending without a court ruling.[19][20]
