Celsius Network Cryptocurrency Fraud Class Action

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.