Report: Former Celsius Executive Pleads Guilty and Cooperates with Prosecutors

A former executive at now-bankrupt Celsius Network, Roni Cohen-Pavon, has reportedly pleaded guilty to criminal charges in the United States and has agreed to cooperate with prosecutors’ investigations.

Cohen-Pavon, who served as chief revenue officer at the cryptocurrency lender founded by Alex Mashinsky, admitted to four charges, including manipulating the price of the exchange’s crypto token Cel, Reuters reported Thursday (Sept. 14).

As part of his plea agreement, Cohen-Pavon has agreed to assist the U.S. Attorney’s office in Manhattan and the FBI with their investigations, according to the report. He has also agreed to testify in court if called upon. This cooperation could potentially impact his sentencing, which is scheduled for Dec. 11, 2024.

Cohen-Pavon’s guilty plea comes after he and Mashinsky were charged in July with market manipulation and wire fraud, the report said. The charges allege that they artificially inflated the value of Cel and cashed out their personal holdings before the collapse of Celsius Network in July 2022.

Mashinsky has pleaded not guilty to these charges and was released on a $40 million bond, per the report.

Celsius Network was one of several cryptocurrency lenders that experienced rapid growth during the COVID-19 pandemic as crypto prices surged, according to the report. These lenders promised easy loan access and attractive interest rates to depositors, lending out tokens to institutional investors to profit from the difference. However, as cryptocurrency prices fell, Celsius Network faced a flurry of customer withdrawals, leading to its collapse.

The collapse of Celsius Network was one of the earliest among several cryptocurrency bankruptcies, including the FTX exchange, the report said.

Cohen-Pavon’s guilty plea and cooperation with prosecutors could potentially have implications for the ongoing investigations and subsequent legal proceedings, per the report. Prosecutors may recommend that the judge take his assistance into account during sentencing.

Celsius was founded by Mashinsky in 2017. The company was valued at more than $3 billion at one point. It had become a big name in the crypto sector by offering high returns while claiming to be less risky than a regular bank, but it became one of several crypto companies to run into trouble during the downturn in the digital assets sector.