The founder and former CEO of Celsius Network, a cryptocurrency lending platform, has been sentenced to 12 years in prison following a federal court ruling over fraudulent practices that misled customers into investing substantial personal savings in what was deceptively promoted as a low-risk opportunity.
Prosecutors described the executive, whose name has not been disclosed in the brief announcement, as a manipulative figure who took advantage of vulnerable individuals by presenting Celsius as a secure and profitable investment vehicle. In reality, the platform engaged in high-risk strategies that contradicted its public messaging.
During sentencing, federal prosecutors emphasized the damage inflicted on thousands of investors who trusted the platform with their money based on false assurances. The court heard testimony and reviewed evidence demonstrating how the company’s internal operations concealed risk and operated similarly to a Ponzi scheme, using funds from new investors to pay returns to earlier ones.
Authorities noted that the defendant ‘preyed on hope,’ targeting everyday individuals who put their life savings into Celsius seeking financial security. The scheme collapsed amid a broader downturn in the cryptocurrency market, exposing the platform’s unsustainable structure and leading to substantial financial losses for users.
The 12-year sentence reflects the seriousness of the fraud and marks another high-profile conviction in the cryptocurrency sector, which continues to grapple with regulatory scrutiny and cases involving deception and financial mismanagement. Regulators have reiterated the importance of investor due diligence and warned against platforms that promise unusually high returns without corresponding risk disclosure.
The sentencing also follows calls from policymakers for tighter regulation of digital asset platforms to protect consumers and ensure financial integrity as the crypto market expands.
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