Founder of Bankrupt Crypto Firm Celsius Arrested on Fraud Charges

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Alex Mashinsky, the founder and former chief executive of the bankrupt cryptocurrency firm Celsius, was arrested on Thursday and charged with fraud, federal prosecutors said.Mr. Mashinsky was also sued by the Securities and Exchange Commission, the Commodity Futures Trading Commission and the Federal Trade Commission. Under a settlement with the F.T.C., Celsius agreed to pay $4.7 billion in restitution to the firm’s customers, although the process of paying that total was suspended while the bankruptcy unfolds.Mr. Mashinsky was arrested at his home in New York, a person close to the investigation said. The charges against him include wire fraud, commodities fraud and manipulation of securities prices.Before it collapsed last year, Celsius rose to prominence as a kind of crypto bank that promised customers sky-high interest rates and handled tens of billions of dollars in deposits. As its charismatic pitchman, Mr. Mashinsky appeared in YouTube videos where he claimed that Celsius was a safer, more egalitarian alternative to traditional banks.At its peak, Celsius controlled about $25 billion in crypto assets. But last summer, Celsius collapsed and filed for bankruptc …