Celsius Exec Sentencing Delayed as Alex Mashinsky Strikes Deal with US Prosecutors

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Hassan Shittu

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Hassan Shittu

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Hassan, a Cryptonews.com journalist with 6+ years of experience in Web3 journalism, brings deep knowledge across Crypto, Web3 Gaming, NFTs, and Play-to-Earn sectors. His work has appeared in...

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December 10, 2024

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Roni Cohen-Pavon, Celsius’s former chief revenue officer, will not face sentencing on December 11, as initially scheduled.

This decision comes after Alex Mashinsky, the former CEO of Celsius, reached an agreement with U.S. prosecutors.

Celsius’s Mashinsky Sentencing Delayed: How Cohen-Pavon’s Testimony Could Impact This Case

In a December 9 filing at the U.S. District Court for the Southern District of New York, Judge John Koeltl approved a request by U.S. Attorney Damian Williams to postpone Cohen-Pavon’s sentencing.

The hearing will now occur after Mashinsky’s sentencing, which is set for April 2025. According to Williams, Cohen-Pavon provided information that could be relevant to the case against Mashinsky.

Cohen-Pavon and Mashinsky were indicted in July 2023 on fraud, securities price manipulation, and conspiracy charges.

They were accused of inflating the value of Celsius’s proprietary token, CEL, and misleading users to gain financial advantage.

The Department of Justice (DOJ) revealed that the two communicated via WhatsApp messages about manipulating CEL prices.

Cohen-Pavon was initially outside the U.S. when the indictment was filed and pleaded not guilty to the charges.

However, after his arrest in September 2023, he changed his plea, admitting guilt to four felony charges, including conspiracy to commit price manipulation, securities fraud, manipulation of security prices, and wire fraud. He has been awaiting sentencing for over a year.

Cohen-Pavon’s sentencing has been delayed following Mashinsky’s recent decision to plead guilty to two charges on December 3.

As part of a deal with prosecutors, Mashinsky faces up to 30 years in prison if sentenced to the maximum term for both charges, which could be served consecutively.

Mashinsky’s admissions, including false claims about Celsius’s regulatory approval and his holdings of CEL tokens, show the extent of the alleged misconduct.

The former CEO of Celsius also agreed to forfeit $48 million in proceeds from the fraudulent scheme.

Mashinsky, Cohen-Pavon, and the $42M Scandal: Inside Celsius’s Legal Turmoil

Celsius was founded in 2017 and filed for Chapter 11 bankruptcy in July 2022 after customers rushed to withdraw deposits amid plummeting crypto prices.

The bankruptcy allowed the company to continue operations while formulating a plan to repay creditors.

Many customers initially couldn’t access their funds. Celsius exited bankruptcy on January 31, 2024, pivoting to Bitcoin mining.

Crypto lenders like Celsius grew rapidly during the COVID pandemic, offering high interest rates to depositors and issuing loans to institutional investors, profiting from the spread.

However, the collapse in token prices during 2022—driven by rising interest rates and persistent inflation—led to Celsius’s downfall. Its bankruptcy followed similar filings by Three Arrows Capital and Voyager Digital.

Federal prosecutors accused Celsius’ founder Alex Mashinsky and former chief revenue officer Roni Cohen-Pavon of manipulating the CEL token’s market.

Cohen-Pavon pleaded guilty in September 2023 and agreed to cooperate in the investigation. Mashinsky allegedly profited $42 million from CEL token sales.

Cohen-Pavon remains free on a $500,000 bond and travels between New York and Israel. He was also allowed to visit Singapore in 2023.