Who Is Alex Mashinsky, The Alleged Man Behind The Celsius Crypto Fraud?

January 5 (Reuters) - Alex Mashinsky, a serial entrepreneur who has described himself as a modern-day Robin Hood, is a co-founder of the insolvent crypto lender Celsius Network which authorities believe bilked investors out of billions of dollars.

According to a complaint filed on Thursday by New York Attorney General Letitia James, Mashinsky, 57, unlawfully advertised Celsius as a secure alternative to banks while hiding that it was losing hundreds of millions of dollars in hazardous investments.

The civil case aims to exclude Mashinsky from conducting business in New York as well as to require him to pay damages, restitution, and disgorgement.

James' lawsuit is the latest setback for the cryptocurrency industry, which has already been shaken by allegations against FTX crypto exchange CEO Sam Bankman-Fried. The former entrepreneur, who has been accused of defrauding investors and inflicting billions of dollars in losses, pleaded not guilty on Tuesday.

Who really is Alex Mashinsky？

Alex Mashinsky is a technological entrepreneur and pioneer best recognized for his work in telecommunications. He is the CEO of Celsius Network, a cryptocurrency loan, and borrowing platform, as well as the creator of numerous other businesses, including Arbinet, a telecommunications firm bought by XTRA Telecom in 2005. Mashinsky has also received honors for his contributions to the advancement of Voice over Internet Protocol (VoIP) technology.

He is a Ukrainian native whose family immigrated to Israel, and he opted to go to New York after seeing the city in 1988, according to a Forbes podcast.

“I glanced around and thought to myself, I'm never going back,” he stated.

He has launched eight businesses since then, including Arbinet, which went public in 2004, and Transit Wireless, which delivers Wi-Fi to the New York City subway system.

Mashinsky claims to have invented VoIP, a forerunner to the ride-sharing software Uber, as well as a concept for a cryptocurrency before bitcoin.

Mashinsky got interested in cryptocurrency in 2017 when his startup firm Governing Dynamics signed a strategic partnership with blockchain business MicroMoney. In the same year, he created Celsius.

According to his website, Mashinsky has raised more than $1.5 billion for different enterprises that yielded more than $3 billion when he and other investors cashed out. He also possesses more than 50 patents.

“The biggest risk is not taking one,” according to the main page.

According to the New York Attorney General's complaint, Mashinsky told Celsius consumers in hundreds of interviews, blog articles, and live broadcasts that if they put digital assets on his platform, they would earn huge returns with no risk.

On Thursday, neither Mashinsky nor his lawyer replied to demands for comment.

Celsius promised investors up to 17% profits, which are among the highest in the business. “We steal it from the affluent,” Mashinsky is quoted as stating in the complaint.

It has gathered $20 billion in digital assets from investors by early 2022. According to the lawsuit, the corporation failed to produce enough cash to pay the stated returns and shifted into significantly riskier ventures.

According to the complaint, the corporation provided hundreds of millions of dollars in uncollateralized loans and invested hundreds of millions more in unregulated decentralized financial platforms.

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