Over half a million people who deposited money with collapsed crypto lender Celsius have been dealt a major blow to their hopes of recovering their funds, with the judge in the bankruptcy case ruling that the money belongs to the company, not depositors.
And while Glenn’s ruling won’t affect FTX, whose terms of use were different, some analysts saw the ruling as spreading beyond Celsius.
A spokesperson for Celsius, Luke Wolf, said Mashinsky is no longer involved in management of the company. Mashinsky did not respond to a message seeking comment.For years, Celsius promised extravagant interest rates in the neighborhood of 20 percent for people in a kind of fantasy version of a real-world bank, driving many who had no interest in crypto to enter the market.
“Touting himself and his company as a modern-day Robin Hood, Mashinsky boasted that Celsius ‘delivers yield … to the people who would never be able to do it themselves, [and] we take it from the rich,’” the suit said. “These promises were false.” The effects could go even beyond them to impact other crypto platforms with strict language in their fine print — presenting problems to customers in the event of a collapse.
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