Court orders asset freeze on Celsius’s former CEO

A New York district court ordered the freezing of assets of Celsius’s former chief executive Alex Mashinsky during the pendency of his criminal case.

This concerns Goldman Sachs bank accounts opened in the name of Koala LLC, and residential property in Austin, Texas.

The order, issued on August 16, has only now been disclosed, amid fears that the accounts could be drained before the freeze takes effect.

In January 2023, the New York Attorney General charged Mashinsky with defrauding investors of billions of dollars. The former Celsius CEO was arrested in July.

In the same month, the U.S. Department of Justice brought seven more criminal charges against him and the platform, including securities fraud, manipulating the CEL token price, misleading investors, and conspiring to defraud customers.

The SEC and CFTC also joined the case.

Mashinsky did not plead guilty to any of the counts. He was later released on $40 million bail.

In June 2022, Celsius halted withdrawals, trading and transfers between accounts due to extreme market conditions.

Following Celsius’s bankruptcy filing, the company reported a hole in the balance of $1.2 billion. In August it emerged that the company’s liabilities exceeded its assets by $2.85 billion.

In September, Alex Mashinsky stepped down as chief executive.

Creditors of Celsius are now voting on the sale of digital assets to the Fahrenheit consortium. If the deal goes through, clients could recover up to 85% of their funds.