Former Celsius CEO seeks to vacate 144-month sentence citing tainted evidence

Alex Mashinsky, the former chief executive of collapsed crypto lender Celsius Network, is asking a federal court to throw out his 144-month prison sentence.

The request comes months after he was sentenced in connection with one of the most closely watched failures in the digital asset lending sector.

Mashinsky, who founded Celsius and later stepped down as the company unravelled, is challenging the outcome of his sentencing.

His legal team argues that the court relied on flawed evidence and legal errors that affected how his conduct and resulting punishment were assessed.

Alex Mashinsky's sentencing and conviction

Mashinsky was sentenced to 12 years in prison, or 144 months, after pleading guilty to commodities fraud and securities fraud.

The case centred on allegations that he misled customers about the financial strength of Celsius Network while the platform was under severe pressure.

Prosecutors said Celsius marketed itself as a safe yield-generating platform while taking risks that were not properly disclosed to customers.

Authorities also pointed to alleged manipulation involving the company’s native CEL token, arguing that trading activity influenced the token’s price in ways that benefited insiders.

The collapse of Celsius affected hundreds of thousands of users and resulted in billions of dollars in losses linked to frozen withdrawals and missing customer funds.

Those losses became a central factor during sentencing and shaped how federal guidelines were applied.

Alex Mashinsky’s motion to vacate sentence

In a new filing, Mashinsky’s legal team asked the court to vacate the sentence or grant post-judgment relief.

The argument does not seek to reopen the fraud case itself. Instead, it challenges the integrity of the sentencing process.

A central claim is that the court relied on tainted or unreliable evidence when determining key sentencing factors, including how losses were calculated and how responsibility was assigned for the scale of harm tied to Celsius’ collapse.

The filing also raises concerns about procedural fairness, arguing that aspects of the sentencing process may have violated due process protections.

According to the motion, the court’s findings were shaped by assumptions that did not fully reflect the underlying financial records and operational realities of Celsius during its final period of operation.

Disputes over loss calculations and sentencing enhancements

One of the key disputes involves the calculation of investor losses. Federal sentencing guidelines often increase penalties sharply when financial harm crosses certain thresholds.

In Mashinsky’s case, prosecutors attributed billions of dollars in losses to conduct linked to Celsius leadership decisions and company disclosures.

The defence argues that those figures overstated the direct impact of Mashinsky’s conduct and failed to distinguish between market-driven losses and company-specific actions.

That distinction is significant because even relatively small adjustments in loss attribution can materially affect sentencing outcomes under federal guidelines.

The filing also challenges several sentencing enhancements, including:

• leadership role adjustments applied to executives deemed to have directed large-scale schemes
• findings related to market manipulation involving CEL token trading activity
• aggregated harm assessments used to justify the final sentencing range

Mashinsky’s legal team argues that these enhancements were applied too broadly and lacked sufficient evidentiary support in parts of the record.

Constitutional and procedural claims

Beyond sentencing calculations, the motion raises broader constitutional concerns.

It argues that Mashinsky’s rights were affected by how evidence was presented and weighed during the proceedings.

The filing also says the court may not have fully accounted for mitigating factors, including the company’s internal complexity and the liquidity crisis Celsius faced during the broader crypto market downturn.

It further questions whether the factual basis supporting the plea and sentencing fully reflected the circumstances under which certain financial decisions were made.

While the motion does not seek to undo Mashinsky’s guilty plea, it argues that the sentencing process contained significant enough errors to justify revisiting the punishment.

What happens next

The motion now leaves the decision to the federal court that handled the original case.

The court must determine whether the claims meet the threshold required to overturn or modify a sentence after judgment has already been entered.

If the motion is denied, the 144-month sentence will remain in place and Mashinsky will continue serving time under the original judgment.

If the court grants any part of the motion, it could order a new sentencing review or revise elements tied to loss calculations and sentencing enhancements.