Monday, December 5, 2022
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Celsius Network CEO withdrew $10M

According to a recent Financial Times investigation, Celsius Network CEO Alex Mashinsky took a whopping $10 million from the platform to pay taxes just before the cryptocurrency lender stopped its customers’ accounts, sending shockwaves throughout the market.

According to the Financial Times, Celsius is expected to disclose details about Mashinsky’s transactions to the court in the coming days as part of a larger financial disclosure.

The choice to remove assets at the time raised eyebrows, with the crypto community wondering if Mashinsky anticipated the company would be in financial trouble following the market drop. According to the article, the $8 million was used to pay taxes on the income earned by assets on Celsius, while the remaining $2 million was in CEL tokens and used for “estate planning.”

Mashinsky’s representative stated that he and his family still have $44 million in cryptocurrency frozen with Celsius, which was disclosed during the bankruptcy proceedings. He did, however, point out that he had deposited monies equal to what he had withdrawn to pay taxes. According to the representative.

“In mid to late May 2022, Mr. Mashinsky withdrew a percentage of cryptocurrency in his account, much of which was used to pay state and federal taxes. In the nine months leading up to that withdrawal, he consistently deposited cryptocurrency in amounts that totalled what he withdrew in May,”

Mashinsky’s behaviour has surely aroused eyebrows, given he was already in hot water. As FatMan from the Terra community pointed out, he had been withdrawing payments while saying the company had “sufficient reserves.”

 Celsius Network  CEO resigns

The developments in the Celsius case continue to happen with increasing frequency and ferocity. Mashinsky only recently filed his resignation. It was announced in a press release on September 27. The former CEO stated that he will continue to endeavour to provide creditors with the best possible outcome.

Additionally, Celsius stated that it will not impose payment responsibilities for outstanding loans, providing some breathing room to the involved debtors. The loans will not be subject to interest or penalties.

On the other side, creditors have taken action to subpoena Equities First, a business involved in the bankruptcy case. They want to know more about the loan arrangements that had been established between Celsius and Equities First, the latter of which had provided money to Celsius. Additionally, they want to know why Equities First was unable to pay Celsius $439 million in collateral.

 

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