New York Attorney General Letitia James said the state has reached a settlement with Alex Mashinsky, the co-founder and former chief executive of Celsius Network, that could require him to pay as much as $35 million and permanently excludes him from several financial industries.

The agreement, announced on October 9, 2026, follows allegations that Mashinsky misled investors about Celsius’s safety and risk profile while hiding losses tied to risky investments. State officials said the conduct affected hundreds of thousands of investors, including more than 26,000 in New York.

Terms of the New York settlement

Under the settlement, Mashinsky is permanently barred from participating in the securities, commodities, and cryptocurrency industries. The financial penalty is structured as a conditional payment that can total up to $35 million.

According to the attorney general’s office, Mashinsky must pay $25 million to New York if he does not forfeit an additional $10 million in alleged ill-gotten gains to the federal government under his plea agreement. He would also owe another $10 million if he does not serve his full federal prison sentence.

What New York says Mashinsky did

James said Mashinsky defrauded investors by presenting Celsius as a safe platform built on low-risk strategies, while concealing losses connected to riskier investments. The attorney general’s office said those alleged misrepresentations reached a large customer base across the country and in New York.

The state’s case focused on claims that investors were given a false picture of the company’s financial condition and the level of risk tied to the platform. In announcing the settlement, James framed the outcome as a response to misconduct that harmed retail customers.

Federal penalties already in place

The New York action comes on top of federal consequences Mashinsky is already facing. He is serving a 12-year federal prison sentence and has been ordered to forfeit more than $48 million at the federal level.

Those penalties are important to the state settlement because part of the New York payment depends on whether the additional federal forfeiture described in his plea agreement is completed, and whether he serves the full sentence.

Bankruptcy recoveries and what comes next

Separate from the state settlement, Celsius investors and creditors have already recovered more than $3.4 billion through the company’s bankruptcy proceedings as of August 2026.

The next confirmed step is whether the conditions tied to the New York deal are triggered. That will determine how much Mashinsky ultimately has to pay the state, within a range that can reach $35 million.

Source: dailyhodl.com