The SEC has taken legal action by filing a lawsuit against Celsius, a cryptocurrency lending company that is currently in a state of bankruptcy.
Amidst the SEC’s growing focus on the cryptocurrency sector, the latest entity to face their scrutiny is the bankrupt crypto platform Celsius.
According to Bloomberg, the SEC has initiated a lawsuit against Celsius Network and its CEO, Alex Mashinsky. The case was filed in a federal court in Manhattan earlier today.
This morning, CEO Alex Mashinsky of Celsius Network was reported to have been arrested.
It has been alleged that the CEO provided misleading information regarding the company’s status, intending to defraud investors and maintain the struggling company’s operations while seeking additional funds.
The SEC is pursuing various actions against Celsius and the CEO, including seeking injunctive relief, restitution, and potentially jail time. The SEC aims to target the assets of both entities involved in the case.
BREAKING: The Securities and Exchange Commission sued Alex Mashinsky, the former chief executive officer of bankrupt crypto lender Celsius Network. The regulator filed the lawsuit this morning in federal court in Manhattan. @avabmorrison
— Ally Versprille (@allyversprille) July 13, 2023
Following the announcement of the lawsuit, the price of CEL experienced a rapid decline of 7%. It is worth noting that the SEC had previously filed lawsuits against major players in the cryptocurrency industry, such as Binance and Coinbase, in early June.
In those particular cases, the SEC alleged that certain altcoins traded on Binance and Coinbase were considered securities, asserting that both exchanges had violated securities laws.
Important:Â Please note that this article is only meant to provide information and should not be taken as legal, tax, investment, financial, or any other type of advice.
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