Indeed, Kristine Mashinsky, the wife of ex-Celsius CEO Alexander Mashinsky, appears to have withdrawn over $2 million in the CEL token on May 31, just before the suspension of withdrawals in June and bankruptcy filing in July, as shown by the latest court filing uploaded by Gizmodo and reported on October 6.
Millions withdrawn while clients were kept in the dark
As Finbold earlier reported, Mashinsky and former Chief Strategy Officer Daniel Leon allegedly removed the cash in Bitcoin (BTC), Ethereum (ETH), USD Coin (USDC), and Celsius (CEL) tokens from custody accounts, as detailed in a Statement of Financial Affairs submitted on October 5. The ex-CEO himself apparently withdrew $10 million, whereas Leon took out $7 million. What’s more, the crypto lender has also been accused by the Vermont Department of Financial Regulation of hiding its financial woes from the investors and engaging in the “improper manipulation of the price” of its tokens to improve its balance sheet.
The problem with KYC
Meanwhile, it is worth noting that the court document counts over 14,000 pages, including the names and recent transactions of every single user on the platform, raising questions over the Know Your Customer (KYC) requirements. Regarding this issue, Nick Hansen, the CEO of Bitcoin mining firm Luxor Mining, referred to the situation as “a perfect demonstration of why KYC only hurts honest consumers.” As he explained:
Auction dates set
Meanwhile, Celsius has scheduled the dates for the auction of its assets in accordance with the insolvency filing submitted to the United States Bankruptcy Court for the Southern District of New York. Specifically, the last bid deadline for Celsius will be on October 17 at 4 p.m., and an auction will be held, if required, on October 20 at 10 a.m. The hearing about the sale is set to take place at 11 a.m. on November 1 via Zoom.
