The United States CFTC has concluded that Celsius Network and its former CEO Alex Mashinsky broke US laws.
Attorneys in CFTC’s enforcement unit have determined that the defunct crypto lender misled investors.
The CFTC could file a federal case this month if a majority of its commissioners come to an agreement.
The platform’s native token CEL has tanked over 12% over the past 24 hours.
The U.S. Commodities and Futures Trading Commission (CFTC) has concluded its probe into the Celsius Network and found that the crypto lender and its founder and former CEO Alex Mashinsky, broke the country’s laws before the firm imploded in mid-2022. The revelation comes almost a year after the crypto lender filed for Chapter 11 bankruptcy, leaving thousands of customers and creditors stranded.
CFTC Could File A Federal Case Against Celsius This Month
According to a report by Bloomberg, the attorneys in the CFTC’s enforcement unit determined that Celsius misled its investors. The attorneys further stated that the defunct crypto lender should have registered itself with the commodities regulator. The CFTC has concluded that Celsius and its former CEO Alex Mashinsky broke U.S. regulations. People familiar with the matter revealed that the CFTC could file a federal case against the crypto lender this month if a majority of its commissioners agree with that conclusion.
Mashinsky is already facing a civil lawsuit from the state of New York. In the lawsuit filed by New York Attorney General Letitia James in January this year, the founder of the defunct crypto exchange was accused of defrauding investors out of billions of dollars by misleading them and misrepresenting the financial health of his crypto firm.
Court filings previously made by the bankrupt crypto firm revealed that it was facing regulatory inquiries from several U.S. agencies, including the Securities and Exchange Commission, Massachusetts Securities Division, and the Washington Department of Financial Institutions Securities Division. The latest development in Celsius’ case led to a decline of over 12% in the platform’s native token CEL. At the time of writing, the token was trading at $0.15.