A federal judge in Manhattan has ordered Alex Mashinsky, co-founder and former CEO of Celsius Network, to pay $10 million to the Federal Trade Commission to settle civil fraud litigation—while simultaneously agreeing to suspend the original $4.72 billion judgment against him, citing his cooperation with the government.
The ruling by Judge Denise L. Cote of the U.S. District Court for the Southern District of New York, entered April 28, 2026, marks the practical end of the FTC’s nearly three-year civil pursuit of the man at the center of the largest crypto lending collapse in American history.
The order resolves the FTC’s claims against Mashinsky individually, distinct from the $4.72 billion corporate settlement reached with Celsius Network itself in July 2023, which had already been suspended pending the return of remaining assets to customers through bankruptcy proceedings.
What the Order Says — Verbatim
The court order contains three consequential components that go beyond the headline number.
First, the permanent injunction. Mashinsky is permanently restrained and enjoined from advertising, marketing, promoting, offering, or distributing — or assisting others in doing so — any product or service that can be used to deposit, exchange, invest, or withdraw assets, whether directly or through an intermediary. He is also permanently banned from misrepresenting any such product or service. In practical terms, this is a lifetime ban from operating in the crypto industry in any meaningful capacity.
Second, the monetary judgment. The court formally entered judgment of exactly $4,720,000,000 in favor of the FTC against Mashinsky as monetary relief. His liability is joint and several with any other defendants to the extent subsequently ordered—meaning if Leon or Goldstein is later found liable, they share that exposure.
Third—and critically—the cross-credit clause. The order specifies that if Mashinsky pays an amount equal to or greater than $10 million to the U.S. Department of Justice pursuant to the forfeiture order entered in U.S. v. Mashinsky, Case No. 1:23-cr-00347 (S.D.N.Y.), that DOJ payment shall be deemed to have satisfied his FTC payment obligation entirely.
In other words, Mashinsky may never write a separate cheque to the FTC at all—his criminal forfeiture payment, if it meets the threshold, counts for both. The order also formally terminates Mashinsky’s status as an officer of Celsius Network Inc., Celsius Network LLC, Celsius Networks Lending LLC, Celsius Lending LLC, Celsius KeyFi LLC, Celsius Mining LLC, and Celsius US Holding LLC.
What the Order Means
The $10 million payment represents a negotiated resolution to claims that Mashinsky personally deceived consumers by misrepresenting the safety of their deposits, the existence of $750 million in insurance, and Celsius’s ability to process withdrawals at any time.
The decision to suspend the larger judgment reflects a standard FTC enforcement mechanism: when a defendant’s assets are insufficient to satisfy the full amount and cooperation with the government is demonstrated, judges routinely accept a reduced sum to avoid prolonged litigation with diminishing returns for consumers.
For Mashinsky, the settlement closes the civil front of a legal siege that has consumed him since 2022. He is already serving a 12-year federal prison sentence after pleading guilty in December 2024 to commodities fraud and securities fraud and agreeing to forfeit over $48 million. The criminal chapter is closed; the civil chapter now is too.
Co-founders Shlomi Daniel Leon and Hanoch “Nuke” Goldstein, who have not settled, remain defendants in the FTC’s ongoing civil case. Their proceedings—still in discovery under the February 27, 2026 fact deadline—are unaffected by Tuesday’s order.
The Original Allegations
The FTC’s July 2023 complaint painted a detailed picture of systematic consumer deception. According to the agency, Mashinsky and his co-founders told 1.7 million users their platform was safer than a bank, promised yields of up to 18.63% APY, and guaranteed withdrawals at any time—claims the FTC alleged were false across the board.
- More than 99% of users earned far below the advertised APY ceiling; the average was just 5.6%.
- The $750 million insurance policy Celsius claimed to hold did not exist.
- In May 2022, days before freezing withdrawals, Mashinsky told customers in a recorded video that “Celsius is stronger than ever” and that the platform had sufficient liquidity.
- Mashinsky, Leon, and Goldstein withdrew significant personal holdings from Celsius in the two months before the company froze all accounts and filed for bankruptcy in July 2022.
When the platform collapsed, customers lost access to savings, retirement funds, and college money held on the platform—collectively representing billions in frozen assets.
A Timeline of Accountability
June 2022 — Celsius freezes all customer withdrawals, citing extreme market conditions.
July 2022 — Celsius files for Chapter 11 bankruptcy. Balance sheet reveals a $1.2 billion hole.
July 13, 2023 — Coordinated enforcement day: DOJ arrests Mashinsky on seven criminal counts. FTC files civil suit and announces $4.7B settlement with Celsius Network (suspended). SEC and CFTC file parallel actions.
Dec. 12, 2023 — Judge Cote denies all motions to dismiss. Civil case against Mashinsky, Leon, and Goldstein proceeds.
Jan. 31, 2024 — Celsius emerges from bankruptcy. Creditor distributions begin—a projected recovery of 67–85% of holdings.
Dec. 3, 2024 — Mashinsky pleads guilty to commodities and securities fraud. Agrees to forfeit $48M+.
May 8, 2025 — Mashinsky sentenced to 12 years in federal prison.
April 28, 2026 — Judge Cote orders Mashinsky to pay $10M to FTC. $4.7B judgment suspended. Civil case against Mashinsky resolved.
Why It Matters for Crypto Regulation
The Celsius enforcement arc—spanning the FTC, DOJ, SEC, and CFTC acting simultaneously—has established a template for how U.S. regulators handle large-scale crypto fraud: pursue the corporate entity and its executives in parallel, across every applicable legal domain, and follow the cases through to individual accountability even after bankruptcy.
The $10 million order is unlikely to generate headlines for its size — it is a fraction of the $4.7 billion ceiling. But its legal significance is the structure: a judge agreeing that cooperation justifies suspension of the full judgment, combined with a prison sentence, creates a precedent that future crypto founders facing regulatory action will need to carefully weigh. The era of treating cooperation as a cost-free hedge against full liability may be closing.
For the 1.7 million customers who deposited assets on Celsius, the settlement changes little in practical terms. Distributions from the bankruptcy estate — which returned the majority of creditor claims in crypto and fiat beginning in early 2024 — have always been the primary recovery vehicle. The FTC judgment was structured from the start to be suspended pending those returns. Tuesday’s order reflects that reality, not a victory of scale, but a formal legal closing of the book on one executive’s civil liability.
What Comes Next
The FTC’s civil case continues against Leon and Goldstein. With fact discovery running through February 2026 and expert reports due in March and April, the two remaining co-founders will face the same core allegations in court—without the option of pointing to Mashinsky’s case as a precedent for cooperation-based relief, unless they choose to pursue their own settlements.
The broader question for the crypto industry is what the Celsius case—in its totality—signals about regulatory appetite. The FTC’s willingness to pursue individual executives to final judgment, even years into a complex bankruptcy, and even after the primary corporate defendant has settled, underscores a posture that shows no sign of retreating.
