Celsius Network Cryptocurrency Fraud Class Action
Case Overview
Celsius Network, once one of the largest cryptocurrency lending platforms in the world, abruptly froze customer withdrawals in June 2022 — trapping an estimated $4.7 billion in customer funds — before filing for Chapter 11 bankruptcy. Customers and creditors alleged that Celsius and its executives, including CEO Alex Mashinsky, made materially false and misleading statements about the platform's financial health, risk management practices, and the safety of deposited assets, inducing hundreds of thousands of retail investors to entrust the platform with their crypto holdings.
The bankruptcy court approved a reorganization plan in November 2023 under which Celsius's assets would be liquidated and distributed to creditors. Alex Mashinsky was separately charged with securities fraud, commodities fraud, and wire fraud by the U.S. Department of Justice in July 2023. The repayment plan — valued at approximately $4.7 billion — aimed to return a significant portion of assets to eligible account holders, though actual recovery rates varied depending on account type and the timing of asset prices at plan confirmation.
Who May Qualify
Individuals or entities who held cryptocurrency deposits, earn accounts, or loan positions on the Celsius Network platform at the time withdrawals were frozen in June 2022 and who filed a timely proof of claim in the bankruptcy proceedings.
Frequently Asked Questions
Will Celsius Network customers get their money back?
Under the approved reorganization plan, most eligible creditors are expected to recover a substantial portion of their claims, though exact recovery rates depend on account type. Distribution of assets began in early 2024.
Was Celsius Network a scam?
The DOJ charged CEO Alex Mashinsky with multiple counts of fraud, alleging he misled customers about the safety of their funds. While the platform was a licensed business, regulators and prosecutors alleged widespread misrepresentation.
Can I still file a claim against Celsius Network?
The initial proof-of-claim deadline in the bankruptcy has passed. However, if you did not receive notice or missed the deadline, you may wish to consult a bankruptcy attorney about your options for late claim filing.