Alex Mashinksy’s assets were frozen by court order in August

A federal court docket in New York issued a Put up-Indictment Restraining Order in opposition to Alexander Mashinsky, former CEO of the bankrupt cryptocurrency lender Celsius Community, on August 16, 2023, freezing his property and prohibiting any transactions.

The order grew to become public data on September 5, when choose paperwork revealing the asset freeze had been unsealed.

The restraining order, which included a number of financial institution accounts and actual property owned by Mashinsky or entities beneath his management, is a part of an ongoing investigation into the alleged misconduct by the previous CEO and his firm. In keeping with filings, the court docket discovered possible trigger that the property of Mashinsky, which is now beneath restraint and topic to forfeiture, is concerned within the proceeds of securities fraud, wire fraud, market manipulation, and cash laundering.

This improvement follows a series of occasions that started in July 2023 when Mashinsky was arrested on fees of fraud introduced by the U.S. Securities and Trade Fee (SEC), accusing Mashinsky and Celsius of deceptive traders and manipulating the worth of Celsius’s personal crypto token, CEL.

Fall from grace

Previously a profitable crypto lending platform, Celsius confronted its downfall when it filed for chapter final yr amid a market downturn that led to the collapse of a number of different crypto-related companies. Celsius was approved by the chapter court docket in July 2023 to transform its altcoin holdings into Bitcoin (BTC) and Ethereum (ETH) as a part of its efforts to stabilize its monetary state of affairs.

Mashinksky, for his half, has “vehemently” denied the allegations leveled in opposition to him. Following his arrest and subsequent launch on a $40 million bail, Mashinsky’s authorized consultant, Jonathan Ohring, said to the media that his shopper categorically rejects all fees. Asserting his innocence, Mashinsky plans to confront these accusations in court docket and intends to “vigorously” defend his fame and the legacy of his contributions to the crypto sector.

Mashinsky’s arrest and the following freezing of his property coincide with an intensified crackdown on fraud within the crypto trade by regulators and legislation enforcement companies. This crackdown is available in response to high-profile collapses within the sector and rising public concern concerning the adequacy of legal guidelines and regulatory oversight, as reported by CryptoSlate.