Celsius founder Alex Mashinsky withdrew $10M weeks before bankruptcy – FT
Celsius Network founder Alex Mashinsky reportedly withdrew $10 million from struggling crypto lenders weeks before the company froze customer funds and filed for bankruptcy. I’m here. report October 2nd.
According to reports, the withdrawal took place in May. This is around the same time the broader market was still reeling from the implosion of the Terra ecosystem.
Details of this transaction, along with others, are expected to be filed with the court in the coming days by the troubled company.
The FT report said Mashinsky’s Celsius withdrawal raises questions about whether he knew the company would be unable to meet its obligations to customers at that point.
Mashinsky claims withdrawal was for taxes
A Mashinski spokesperson who told the FT said the withdrawal was done to offset “state and federal taxes.” He went on to say that “[Mr Mashinsky]has consistently deposited cryptocurrency in the total amount he withdrew in May.”
The spokesperson also revealed that Mashinsky and his family have frozen $44 million worth of cryptocurrency on the platform.
Former CEOs, on the other hand, could be forced to return the money. Payments made by bankrupt companies 90 days prior to his declaration of bankruptcy may be reversed for the benefit of all creditors under US law.
Mashinski faced some criticism for spreading false information about the safety of users’ funds when the crypto lender was on the brink of bankruptcy.
Mashinsky stepped down as CEO on Sept. 27, apologizing for his “difficult financial situation,” but saying his role as CEO had become a distraction.
Investor claims Mashinski asked him to invest more
BnkToTheFuture CEO Simon Dixon said Mashinsky said “all is well” but urged him to “invest in more clients’ retirement savings.”
“Founder of Celsius Network withdrew $10 million before bankruptcy” – you told me everything was fine @ machine ski & I should invest my client’s retirement money more. You broke your silence and accused me of lying, stealing and cheating. Insider clawback please. https://t.co/xP4vW6QCtr
— Simon Dixon (Beware of Impersonation) (@SimonDixonTwitt) October 2, 2022
Dixon also said he wanted an “insider clawback.” According to Wikipedia, a clawback refers to money or benefits that were offered but need to be returned due to exceptional circumstances or events.
