New York state has permanently barred Alex Mashinsky (알렉스 매신스키), former CEO of bankrupt crypto lending platform Celsius Network, from the securities, commodities and cryptocurrency industries. A related $35 million financial penalty is structured to apply only if certain conditions are not met, making it likely New York will not receive money.

On Oct. 9, blockchain outlet Cryptopolitan reported that New York Attorney General Letitia James (레티샤 제임스) filed a lawsuit in 2023, saying Mashinsky falsely promoted Celsius as safe and misled users. The measure permanently bans Mashinsky from entering the industry and finalises a conditional financial penalty.

The key is that the $35 million is not a fine that must be paid immediately. The attorney general's office said the penalty is split into two conditions. Mashinsky must pay New York $25 million if he does not forfeit $10 million in ill-gotten gains to the federal government. The remaining $10 million is imposed only if Mashinsky does not serve his full prison term.

According to court documents, Mashinsky has already accepted a federal forfeiture order of $48,393,446 in a federal criminal case. If that amount is actually forfeited and he completes the full term imposed, he would owe nothing to New York. That means New York can secure the penalty only if Mashinsky fails to comply with key terms of a federal agreement he reached to reduce his sentence.

This is not the first time Mashinsky has been barred from the industry. The U.S. Federal Trade Commission ordered Mashinsky to pay $10 million and barred him from the cryptocurrency and financial services industries, alongside a $4.7 billion suspended judgment. The U.S. Commodity Futures Trading Commission also added a permanent trading ban and a registration ban through a court consent order in June.

Mashinsky is currently serving his sentence. He pleaded guilty to commodities fraud and manipulating the price of Celsius' CEL token, and was sentenced in May 2025 to 144 months in prison. The term totals 12 years. New York's move focuses on blocking any possibility that Mashinsky, already incarcerated, could return to the industry in the future.

Regulatory legal proceedings are also not over. A separate lawsuit filed by the U.S. Securities and Exchange Commission in July 2023 is ongoing. The main issues are allegations of offering unregistered securities and manipulating the price of the CEL token. The SEC said in late May it had held substantive settlement discussions with Mashinsky's side in federal court, but it did not reach a settlement at the time. The court granted an additional 60 days for further talks. If a settlement is reached on terms similar to those of other regulators, Mashinsky could effectively face an additional near-lifetime ban from entering the industry.

The case gained momentum in June 2022 when Celsius halted customer withdrawals. Celsius filed for Chapter 11 bankruptcy protection in the United States the following month, and users who had entrusted assets suffered heavy losses. Through bankruptcy proceedings, creditors had recovered more than $3.4 billion as of August 2026.

James said in a statement she would not allow fraudsters to use cryptocurrency to prey on unwary New York residents. The measure is seen as having greater significance in cutting off Mashinsky's return to the industry and holding fraud in the crypto market to account than in recovering cash.