The CEO of Celsius would have withdrawn 10 million dollars just before the bankruptcy of the company!

Not good news for either clients or the crypto industry, with the former losing access to funds and the latter losing credibility, the outright bankruptcy of the crypto lending platform Celsius will have had the only benefit to animate the debates and the news of the industry. In that case, we learned today that Alex Mashinsky, the now ex-CEO, quietly withdrew $10 million from the platform days before withdrawals closed and the company was liquidated.

A withdrawal before the collapse of Terra

The news was reported by our colleagues from the Financial Times. The Celsius founder, who had funds on his platform, withdrew $10 million in the days before he filed for bankruptcy, according to people familiar with the matter.

Masinski withdrew the funds “between mid-May and the end of May 2022”, according to one of his spokespersons. This is embarrassing considering that Celsius had already started to struggle at this point. As a reminder, the first default rumors began to circulate at the beginning of June. Withdrawals and transfers were suspended on June 13.

The withdrawal of funds was therefore carried out knowing that the company was heading towards bankruptcy. According to the same report, this information about this withdrawal raises questions and reinforces the scrutiny of the facts of Mashinsky, who knew that the company could not return customer funds.

Suddenly, the leader of Celsius is accused of having sought to protect his savings knowing that this could worsen the situation of the company. However, Mashinsky’s spokesperson noted that the Celsius founder (and his family) still had $44 million in funds still frozen by the platform. Also, according to the same source, the $10 million was withdrawn for tax purposes.

Last week, Masinski resigned as CEO of Celsius. However, he retained his position as a director of Celsius Networks Ltd and will continue to serve on the board. Because of this, Celsius may file details of the former CEO’s dealings with the court as part of a broader disclosure of his financial affairs.

A timing problem

It’s not just quantity that’s the problem, it’s more about timing in this case. In fact, this major withdrawal happened just days before the Celsius platform completely froze withdrawals for its customers.

However, it was difficult to imagine the events to come for the CEO, at least in this case, we recall, marked by the catastrophe of the collapse of the UST/Terra ecosystem.

The Wall Street Journal, citing people familiar with the matter, said the levy was intended to allow Masinski to pay state and federal capital gains taxes. Moreover, these withdrawals would be part of a recurring and planned mechanism. In short, nothing out of the ordinary.

If the shadow of doubt continues to hang over this operation, it is because this is not the first time that Mashinsky has been caught with “weird” operations. Indeed, it should be recalled that an attempt was made a few weeks ago to recover some CEL tokens as “pocket money”.

The Celsius founder may have to return the $10 million. US law provides that funds withdrawn by executives within 90 days of bankruptcy can be recovered for distribution to creditors.

The volatility of the crypto ecosystem continues to create surprises. While Celsius is going through a tough time, the platform’s native token is currently trading in the green, according to data from Tradingview. Also, despite recent details, Alex Mashinsky continues to work hard to deliver the best possible outcome for creditors.

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The CEO of Celsius would have withdrawn 10 million dollars just before the bankruptcy of the company!

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