Victim impact statements in the Celsius case show how devastating crypto collapses are even under the poor previous regulations, which the crypto industry is now arguing were so draconian as to stifle the industry entirely.
![Alex Mashinsky and Celsius
Celsius CEO Alex Mashinsky has filed his sentencing submission for his upcoming sentencing on May 8.3 After pleading guilty to fraud and market manipulation just ahead of his scheduled trial [I71], Mashinsky is now asking to be sentenced to no more than a year in prison. Sentencing guidelines recommend a sentence of thirty years. Prosecutors have not yet filed their submission, although they have submitted more than 200 victim impact statements.
These are heartwrenching, and there are numerous statements from elderly or otherwise vulnerable people who were coaxed to put their life savings into Celsius. The letters really drive home a point I try to make often: some people dismiss the crypto industry’s abuses as though they only harm those who “deserve it” — often picturing a caricature of a young, greedy crypto bro who fully understands the risks he’s taking, gambling away money he can afford to lose. In reality, we frequently see the crypto industry actively targeting the most vulnerable, and these are the people who are worst harmed during crypto’s regular disasters. In fact, the FBI just published its 2024 Internet Crime report, showing that Americans over 60 suffered the most out of reported losses involving crypto, measured by both number of complaints (33,369) and the amount lost ($2.8 billion).4d](/proxy/post_attachment/484549/d3f2fd5127.png "Alex Mashinsky and Celsius
Celsius CEO Alex Mashinsky has filed his sentencing submission for his upcoming sentencing on May 8.3 After pleading guilty to fraud and market manipulation just ahead of his scheduled trial [I71], Mashinsky is now asking to be sentenced to no more than a year in prison. Sentencing guidelines recommend a sentence of thirty years. Prosecutors have not yet filed their submission, although they have submitted more than 200 victim impact statements.
These are heartwrenching, and there are numerous statements from elderly or otherwise vulnerable people who were coaxed to put their life savings into Celsius. The letters really drive home a point I try to make often: some people dismiss the crypto industry’s abuses as though they only harm those who “deserve it” — often picturing a caricature of a young, greedy crypto bro who fully understands the risks he’s taking, gambling away money he can afford to lose. In reality, we frequently see the crypto industry actively targeting the most vulnerable, and these are the people who are worst harmed during crypto’s regular disasters. In fact, the FBI just published its 2024 Internet Crime report, showing that Americans over 60 suffered the most out of reported losses involving crypto, measured by both number of complaints (33,369) and the amount lost ($2.8 billion).4d")
![Some excerpts from the submissions:
[I’m] ashamed to admit to you, family and friends how much Alex [Mashinsky] took from me. Decades of hard work that would have created generational wealth for my family is gone. Everyday that I have to keep waking up at 6am to work a physical labor dead end job I’m reminded what you stole from me.
I’m now 59 and lost my entire life savings (nearly 9 Bitcoin) in the Celsius bk case. Needless to say, at my age, it was absolutely devastating. I had retired & had no income and was planning to rely on the bitcoin to live on. I lost my apartment, I could no longer help my very sick mother, I had to liquidate everything else I owned just to scrape by. I literally had to ‘camp’ out of my vehicle for nearly a year until I could begin to get back on my feet.
The financial devastation triggered constant arguments and fights between my wife and me. The economic strain put so much pressure on our relationship that my wife eventually asked for a divorce. Over time, the situation became unbearable, and my wife returned to the Netherlands with my daughter, leaving me behind in Spain. Now, I am not only financially ruined but also alone and separated from my daughter.
I’m a blind father of three that hasn’t worked [redacted] I was desperate and sought yield and ran across Celsius and placed a significant portion of my net worth there and now lets just say we are struggling. I’m now 50k [in] credit card debt just trying to survive with inflation and very](/proxy/post_attachment/484551/982eb52f36.png "Some excerpts from the submissions:
[I’m] ashamed to admit to you, family and friends how much Alex [Mashinsky] took from me. Decades of hard work that would have created generational wealth for my family is gone. Everyday that I have to keep waking up at 6am to work a physical labor dead end job I’m reminded what you stole from me.
I’m now 59 and lost my entire life savings (nearly 9 Bitcoin) in the Celsius bk case. Needless to say, at my age, it was absolutely devastating. I had retired & had no income and was planning to rely on the bitcoin to live on. I lost my apartment, I could no longer help my very sick mother, I had to liquidate everything else I owned just to scrape by. I literally had to ‘camp’ out of my vehicle for nearly a year until I could begin to get back on my feet.
The financial devastation triggered constant arguments and fights between my wife and me. The economic strain put so much pressure on our relationship that my wife eventually asked for a divorce. Over time, the situation became unbearable, and my wife returned to the Netherlands with my daughter, leaving me behind in Spain. Now, I am not only financially ruined but also alone and separated from my daughter.
I’m a blind father of three that hasn’t worked [redacted] I was desperate and sought yield and ran across Celsius and placed a significant portion of my net worth there and now lets just say we are struggling. I’m now 50k [in] credit card debt just trying to survive with inflation and very")
DWF Labs has joined Justin Sun in purchasing tens of millions in WLFI tokens from the Trump family’s World Liberty Financial project. DWF Labs was previously accused in a Wall Street Journal report of engaging in massive market manipulation.
Brandon Lutnick, Commerce Secretary Howard Lutnick’s son who replaced him as chair of Cantor Fitzgerald when he “divested” his interest, is launching a bitcoin investment vehicle called Twenty One Capital.
![Brandon Lutnick, Commerce Secretary Howard Lutnick’s son who replaced him as chair of Cantor Fitzgerald when he “divested” his interest, is launching a bitcoin investment vehicle called Twenty One Capital.23 The company is backed by the notorious Tether stablecoin issuer and its sister company Bitfinex, with a minority stake held by SoftBank. The venture is launching with 42,000 BTC, putting its value at launch at around $3.6 billion, and it seeks to be a MicroStrategy-esque “public stock, built by Bitcoiners, for Bitcoiners”.24 Howard Lutnick already faced scrutiny during his Senate confirmation about his firm’s close links to Tether, and this move only deepens his and his family’s ties to the business [I76].](/proxy/post_attachment/484555/49e45c7a07.png "Brandon Lutnick, Commerce Secretary Howard Lutnick’s son who replaced him as chair of Cantor Fitzgerald when he “divested” his interest, is launching a bitcoin investment vehicle called Twenty One Capital.23 The company is backed by the notorious Tether stablecoin issuer and its sister company Bitfinex, with a minority stake held by SoftBank. The venture is launching with 42,000 BTC, putting its value at launch at around $3.6 billion, and it seeks to be a MicroStrategy-esque “public stock, built by Bitcoiners, for Bitcoiners”.24 Howard Lutnick already faced scrutiny during his Senate confirmation about his firm’s close links to Tether, and this move only deepens his and his family’s ties to the business [I76].")
Jay Clayton has been installed as the US Attorney for the Southern District of New York despite having no prosecutorial experience. SDNY handles some of the biggest white collar cases.
![Jay Clayton, Trump’s pick for the US Attorney for the Southern District of New York, was sworn in on April 22 [I70]. His interim appointment follows a massive shakeup at the prosecutor’s office, which oversees many of the largest white collar crime prosecutions (including those against Trump), and which has already chewed through three acting US Attorneys since Damian Williams’ resignation in November. Danielle Sassoon, a familiar name to those who followed the FTX trial and observed her as the lead prosecutor in the case against Sam Bankman-Fried, spent only three weeks in the role before she resigned in protest instead of agreeing to drop corruption charges against New York Mayor Eric Adams.25 Trump had tried to install Clayton in the role during his first presidency, but then-US Attorney Geoffrey Berman, who was handling cases involving Trump associates, refused to resign. Eventually Trump fired Berman, who agreed not to fight the firing when he was informed that his deputy would take the role instead of Clayton. Clayton was eventually installed as the SEC Chair under the first Trump administration.26 Trump has named Clayton as an interim appointee, apparently in an effort to exploit a loophole allowing Clayton to serve without going through the normal confirmation process.27 Clayton has no prosecutorial experience.](/proxy/post_attachment/484556/301bca2b5c.png "Jay Clayton, Trump’s pick for the US Attorney for the Southern District of New York, was sworn in on April 22 [I70]. His interim appointment follows a massive shakeup at the prosecutor’s office, which oversees many of the largest white collar crime prosecutions (including those against Trump), and which has already chewed through three acting US Attorneys since Damian Williams’ resignation in November. Danielle Sassoon, a familiar name to those who followed the FTX trial and observed her as the lead prosecutor in the case against Sam Bankman-Fried, spent only three weeks in the role before she resigned in protest instead of agreeing to drop corruption charges against New York Mayor Eric Adams.25 Trump had tried to install Clayton in the role during his first presidency, but then-US Attorney Geoffrey Berman, who was handling cases involving Trump associates, refused to resign. Eventually Trump fired Berman, who agreed not to fight the firing when he was informed that his deputy would take the role instead of Clayton. Clayton was eventually installed as the SEC Chair under the first Trump administration.26 Trump has named Clayton as an interim appointee, apparently in an effort to exploit a loophole allowing Clayton to serve without going through the normal confirmation process.27 Clayton has no prosecutorial experience.")
While federal regulators are backing off the crypto industry under orders from the Trump administration, some state regulators are stepping up. Oregon Attorney General Dan Rayfield has filed a case against Coinbase seeking to “fill the enforcement vacuum” left by Trump’s SEC.
![State regulators
While federal regulators are backing off the crypto industry under orders from the Trump administration, some state regulators are stepping up. Oregon Attorney General Dan Rayfield has filed a case against Coinbase, saying that he believes “states must fill [the] enforcement vacuum being left by federal regulators who are abandoning these cases under [the] Trump administration”. The lawsuit makes similar allegations as the original SEC case, but under Oregon state securities laws.35 Coinbase is predictably furious, with Coinbase’s Chief Legal Officer and designated Twitter attack dog Paul Grewal tweeting that “This type of political jockeying is an embarrassing waste of Oregon taxpayer dollars.”36 I can certainly think of some wasteful and embarrassing political jockeying, but it’s not happening in Oregon.
A judge has denied most of DCG’s arguments in the company’s motion to dismiss a lawsuit from the New York Attorney General over the losses of its now bankrupt Genesis subsidiary, related to its partnership with Gemini. Two claims were dismissed as duplicative, but the majority of the case will be allowed to proceed as the judge has found that the NYAG had adequately argued at this stage that the Gemini Earn lending program was a security.37 At the federal level, the portion of an SEC case against Gemini has been paused pending “potential resolution” [I81]. The portion targeting Genesis had already been settled in March 2024 with a $21 million penalty [I50]](/proxy/post_attachment/484557/d070f863cf.png "State regulators
While federal regulators are backing off the crypto industry under orders from the Trump administration, some state regulators are stepping up. Oregon Attorney General Dan Rayfield has filed a case against Coinbase, saying that he believes “states must fill [the] enforcement vacuum being left by federal regulators who are abandoning these cases under [the] Trump administration”. The lawsuit makes similar allegations as the original SEC case, but under Oregon state securities laws.35 Coinbase is predictably furious, with Coinbase’s Chief Legal Officer and designated Twitter attack dog Paul Grewal tweeting that “This type of political jockeying is an embarrassing waste of Oregon taxpayer dollars.”36 I can certainly think of some wasteful and embarrassing political jockeying, but it’s not happening in Oregon.
A judge has denied most of DCG’s arguments in the company’s motion to dismiss a lawsuit from the New York Attorney General over the losses of its now bankrupt Genesis subsidiary, related to its partnership with Gemini. Two claims were dismissed as duplicative, but the majority of the case will be allowed to proceed as the judge has found that the NYAG had adequately argued at this stage that the Gemini Earn lending program was a security.37 At the federal level, the portion of an SEC case against Gemini has been paused pending “potential resolution” [I81]. The portion targeting Genesis had already been settled in March 2024 with a $21 million penalty [I50]")
Stablecoin bills have hit a little turbulence in Congress, with Coinbase now actively fighting against a standalone stablecoin bill and various people expressing concern that Trump’s crypto corruption could derail the industry’s desired legislation.
![In Congress
Congress is still working on stablecoin regulation, though it’s not been without snags. I noted last issue that even Republican House Financial Services Committee Chair French Hill (AR) had noted that Trump’s crypto endeavors were “complicat[ing]” Congress’s work in passing stablecoin legislation.
Now there’s infighting among the crypto lobbyists pushing to get these new rules through Congress, with reports that Coinbase is trying to convince Congress to pump the brakes on standalone stablecoin bills in favor of passing one giant bill that would combine stablecoin and crypto market regulation changes. It seems that they’re concerned that goodwill for crypto is drying up somewhat in Congress, and their priority is a market structure bill that might definitively safeguard their company from the bigger threat of crypto assets being designated as securities. An anonymous source quoted by Decrypt explained their reasoning: “If we only do stablecoin, they think there might not be enough interest or appetite or time left to also do market structure.” According to the outlet, this is “causing friction in the tight-knit world of crypto policy” as the GENIUS Act approaches a floor vote [I79, 76].38 This is a sentiment shared by some outside of politics, with analysts from the major investment bank TD Cowen commenting that “political threats could intensify to the point where they become a threat to legislative and regulatory reforms for crypto”, citing controversy around](/proxy/post_attachment/484558/20a2579809.png "In Congress
Congress is still working on stablecoin regulation, though it’s not been without snags. I noted last issue that even Republican House Financial Services Committee Chair French Hill (AR) had noted that Trump’s crypto endeavors were “complicat[ing]” Congress’s work in passing stablecoin legislation.
Now there’s infighting among the crypto lobbyists pushing to get these new rules through Congress, with reports that Coinbase is trying to convince Congress to pump the brakes on standalone stablecoin bills in favor of passing one giant bill that would combine stablecoin and crypto market regulation changes. It seems that they’re concerned that goodwill for crypto is drying up somewhat in Congress, and their priority is a market structure bill that might definitively safeguard their company from the bigger threat of crypto assets being designated as securities. An anonymous source quoted by Decrypt explained their reasoning: “If we only do stablecoin, they think there might not be enough interest or appetite or time left to also do market structure.” According to the outlet, this is “causing friction in the tight-knit world of crypto policy” as the GENIUS Act approaches a floor vote [I79, 76].38 This is a sentiment shared by some outside of politics, with analysts from the major investment bank TD Cowen commenting that “political threats could intensify to the point where they become a threat to legislative and regulatory reforms for crypto”, citing controversy around")
@molly0xfff they wanted someone corrupt but he’s proving to be too corrupt for even their expectations. This is hilarious stuff.
