Alex Mashinsky, the former CEO of Celsius, is seeking testimony from his former top executives in court as his criminal trial is set to start today (Tuesday). According to a memorandum filed on Friday by his lawyers, he has asked the court to allow six witnesses, including the crypto lender’s former Chief Financial Officer and Chief Revenue Officer.

“As the CEO of Celsius, Mr. Mashinsky relied on information provided to him by the experienced team of Celsius professionals around him,” the memorandum stated, highlighting that Mashinsky did not intend to harm anyone.

Another High-Profile Crypto Trial

Mashinsky was arrested in New York in July last year and charged with defrauding customers and misleading them about the company’s profitability. He is facing seven counts of criminal charges, ranging from fraud and conspiracy to fraud and market manipulation. He is now facing a maximum of 115 years in prison.

He pleaded not guilty to the charges and was released with a $40 million bail bond.

“The stakes are high,” the lawyers added in the memorandum. “The government has informed the defence that its ‘current position’ is that the Sentencing Guidelines call for Mr. Mashinsky to receive a sentence of 115 years in prison.”

Along with Mashinsky, US prosecutors have also charged the crypto lender’s former Chief Revenue Officer, Roni Cohen-Pavon, with manipulating the markets for the platform’s token. Cohen-Pavon is facing a maximum of 65 years in prison and reportedly pleaded guilty last year.

Fraud and Market Manipulation

Celsius Network, founded by Mashinsky in 2017, entered the crypto market in 2018 with an initial coin offering. The company saw massive growth during the crypto boom of 2021, becoming one of the biggest digital asset lenders in the world. However, the platform filed for bankruptcy in 2022, which subsequently attracted the attention of regulators.

The Securities and Exchange Commission (SEC) also charged Celsius and Mashinsky for allegedly raising billions through fraudulent and unregistered crypto sales, lying to the company’s investors, and manipulating the price of CEL, the platform’s native token.

According to the prosecutors, Mashinsky and Cohen-Pavon bought millions of dollars' worth of CEL to artificially inflate its price in the open markets and then sold them for profit.

“Mr. Cohen-Pavon is a material witness on the manipulation charges because he provided legal advice to Celsius regarding the manner in which it purchased and sold CEL tokens in the open market from 2019 through 2022,” the latest memorandum by Mashinsky's lawyers added.

Meanwhile, Celsius's bankruptcy administrators announced earlier this year that they plan to distribute over $3 billion of cryptocurrency and fiat to its creditors. The plan also involved the creation of a Bitcoin mining company, and existing Celsius creditors will receive a stake in it.

The bankrupt company also paid US agencies $4.7 billion to settle fraud charges.

This article was written by Arnab Shome at www.financemagnates.com.