Lawyers for Alex Mashinsky, the former CEO of Celsius, have submitted a motion requesting a reduced sentence of one year. They are challenging the US Department of Justice’s (DOJ) recommendation of a 20-year sentence ahead of the forthcoming sentencing hearing.
Former Celsius CEO Critiques 20-Year Sentence Proposal
On a recent Monday, Mashinsky’s legal team appealed to the US District Court for a more lenient one-year sentence. Their memorandum, submitted on May 5, describes the government’s proposed sentence as tantamount to a “death-in-prison” outcome.
Prosecutors recently presented statements from over 200 Celsius customers outlining the emotional and financial toll of the company’s downfall. They further characterized Mashinsky as a continuing threat due to his perceived “lack of remorse.”
In their sentencing memo from April 28, prosecutors suggested a 20-year sentence for Mashinsky, stressing that, unlike FTX’s Sam Bankman-Fried (SBF), he was suitably mature and experienced to understand the severity of his actions.
They noted that the 25-year sentence given to Bankman-Fried is a critical reference point for the Court’s deliberation.
In their recent motion, Mashinsky’s defense team labeled the prosecution’s memo as a “venom-laced submission” that essentially advocates for a life sentence expecting Mashinsky to be 79 upon release.
His attorneys argued that prosecutors aimed to “dehumanize” him, depicting him as a predator while neglecting to mention his status as a first-time, non-violent offender.
The government’s emotionally charged submission mischaracterizes the case, suggesting it involves a predator intent on victimizing others and stealing funds, while recommending an extreme sentence for someone who has accepted responsibility.
Celsius’ Downfall
The collapse of Celsius occurred during the 2022 crypto market downturn, leading to a freeze on user withdrawals and eventually the company filing for bankruptcy.
In the aftermath, the SEC charged Mashinsky with fraud and market manipulation, claiming he misled investors about the safety of their funds in Celsius and its CEL token.
In November 2024, Mashinsky attempted to dismiss the fraud charges but was unsuccessful. The following month, he pleaded guilty to two counts of fraud, acknowledging his involvement in commodities and securities fraud, and agreeing to forfeit approximately $48 million from his illegal gains.
According to the recent filing, granting the DOJ’s sentence would create an “unwarranted disparity,” presenting a “distorted and ruthless view of Alex,” akin to infamous criminals like SBF or Bernie Madoff.
Such a severe sentence ignores Alex’s commendable life of service. A life sentence would unjustly overshadow his military and charitable contributions, treating him as if those accomplishments are entirely inconsequential. It is a caricature of who Alex Mashinsky truly is.
Given these arguments, Mashinsky’s lawyers have asked the Court to issue a sentence that does not exceed 366 days during the hearing scheduled for May 8.
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