New York AG Letitia James secures up to $35M from former Celsius CEO Alex Mashinsky

Alex Mashinsky is already serving a 12-year prison sentence. Now New York wants its money too.

On October 8, 2026, New York Attorney General Letitia James announced a settlement with the former Celsius Network CEO. It requires Mashinsky to pay up to $35 million to the state and bars him from trading securities or crypto.

The deal resolves fraud allegations tied to Celsius’s Earn Interest Accounts and its native token, CEL. It is one of the last open legal threads from one of crypto’s most damaging collapses.

What the settlement actually says

The $35 million figure has two parts.

The first is a $25 million payment in damages to New York. The second is a $10 million monetary judgment. Mashinsky’s federal forfeiture obligations could potentially reduce that second piece.

That explains the “up to” in the headline number. New York may not collect the full $35 million in practice, depending on how the federal and state obligations line up.

The agreement blocks Mashinsky from taking part in any trading of securities or crypto.

The case started as a civil complaint filed in 2023 under the Martin Act. That is New York’s securities fraud statute, and it gives the attorney general unusually wide reach.

The Martin Act is known for setting a low bar. Prosecutors generally do not need to prove that a defendant intended to defraud anyone.

How Celsius got here

Celsius launched its Earn program in 2018. The pitch was simple: deposit your crypto and earn yield on it, like a savings account but with better returns.

The state alleged the reality was less simple. Its complaint said Celsius and Mashinsky used deceptive practices that misled more than 26,000 New York investors.

The CEL token was central to the case. Mashinsky sold 25 million CEL tokens worth $68.7 million without disclosing it. During that period he publicly talked up the token’s value.

Celsius filed for Chapter 11 bankruptcy on July 13, 2022, as the market froze. Customer deposits were stuck. Losses during the bankruptcy topped $4.7 billion.

A pile of penalties

The New York settlement comes after a series of state and federal actions against Mashinsky.

In May 2025, he was sentenced to 12 years in prison after pleading guilty to commodities and securities fraud related to Celsius’s operations. He was also ordered to forfeit $48,393,446 in the federal case.

Federal regulators added their own terms in 2026. The Commodity Futures Trading Commission entered a consent order in June 2026 that imposed a permanent trading ban.

In July 2026, the Federal Trade Commission reached a settlement with Mashinsky for $10 million. It also included a lifetime ban on promotional activity.

Put together, the record looks like this:

• May 2025: 12-year prison sentence and $48,393,446 in forfeiture
• June 2026: CFTC consent order with a permanent trading ban
• July 2026: FTC settlement for $10 million and a lifetime promotional ban
• October 8, 2026: New York settlement for up to $35 million plus a securities and crypto trading prohibition

What this means for crypto lending and its customers

The most direct question for Celsius victims is whether this money reaches them. The state payment is a penalty against Mashinsky personally, not part of the bankruptcy estate. The possible offset against federal forfeiture also means the state and federal claims overlap rather than simply adding up.

Even at the full $35 million, the amount is small next to more than $4.7 billion in customer losses.

The case also shows how state enforcers work alongside federal agencies. New York used the Martin Act to pursue its own claims on behalf of more than 26,000 residents, separate from the federal track.

Celsius filed for bankruptcy in July 2022, and New York’s settlement arrived in October 2026. That is more than four years from collapse to resolution.

What to watch next is how the $10 million judgment plays out against Mashinsky’s federal forfeiture, which will decide how much New York actually collects.