that Alex Mashinsky, the founder of Celsius Network, was arrested on federal securities fraud charges. The now-bankrupt crypto lending platform has agreed to a staggering $4.7 billion settlement with government regulators, marking one of the largest settlements in the history of the FTC.
According to the SEC, Celsius and Mashinsky defrauded investors by fabricating information about their revenue, the way they lent out users’ cryptocurrency, and their own risky trading methods. Mashinsky had promoted Celsius as a safe alternative to banks, promising returns as high as 17 percent by lending out their crypto.
Federal prosecutors allege that Mashinsky misrepresented a number of things, including the security of Celsius’s yield-generating operations, the company’s profitability, the long-term viability of Celsius’ high reward rates, and the risks involved in deposing crypto assets with Celsius.