Celsius Co-founders Leon and Goldstein to Pay FTC Over $6.5 Million

Shlomi Daniel Leon and Hanoch “Nuke” Goldstein, co-founders of the cryptocurrency lending platform Celsius Network, have agreed to pay a combined $6.5 million to the U.S. Federal Trade Commission (FTC) to resolve allegations of deceiving investors. Leon will pay $4.1 million, and Goldstein will pay $2.4 million. This settlement is part of a broader regulatory crackdown following Celsius's bankruptcy and the loss of billions in assets by thousands of customers.

According to the FTC's complaint filed in July 2023, Celsius and its founders misled consumers into transferring cryptocurrency onto their platform by falsely promising that deposits would be safe and always available. The company claimed to have a $750 million insurance policy for deposits, which was untrue. Customers were also promised high annual percentage yields, some as high as 18%. However, while lying to customers to prevent them from withdrawing their cryptocurrency deposits, Leon, Goldstein, and former CEO Alex Mashinsky withdrew significant sums of cryptocurrency from Celsius just two months before the company filed for bankruptcy.

The FTC alleged that Celsius had only a small capital reserve, which would have allowed only a fraction of its customers to withdraw their cryptocurrency within one week. Furthermore, the company lacked any system to track its assets and liabilities until mid-2021. The commission stated that Celsius and its top executives made misleading claims that they earned profits at “no risk” to consumers and that their deposits were safe.

These developments sent shockwaves through the cryptocurrency markets, resulting in hundreds of thousands of customers losing access to approximately $4.7 billion in assets. Celsius's collapse in 2022 deepened the existing crisis of confidence in the crypto space following the TerraUSD implosion, increasing skepticism towards high-yield crypto lending platforms. The company filed for Chapter 11 bankruptcy in July 2022, subsequently reporting a $1.19 billion hole in its balance sheet.

This settlement follows former CEO Alex Mashinsky's $10 million agreement with the FTC in April 2026, which also included a permanent ban from promoting crypto products. Mashinsky was also sentenced to 12 years in prison in May 2025 after pleading guilty to commodities fraud and securities fraud charges. Both Leon and Goldstein have also agreed to bans on marketing or selling certain cryptocurrency-related products or services. This demonstrates the determination of regulatory bodies to combat fraud and deceptive practices in the cryptocurrency markets.

Analysts and market observers indicate that such regulatory actions are a significant step towards increasing transparency and investor protection in the cryptocurrency sector. In the coming period, regulatory bodies are expected to further tighten their oversight, especially over decentralized finance (DeFi) and crypto lending platforms. This could serve as a warning to other companies operating in the market, leading to the adoption of stricter compliance standards.