In a significant development within the cryptocurrency sector, Roni Cohen-Pavon, the former Chief Revenue Officer (CRO) of Celsius, has entered a guilty plea in the United States District Court for the Southern District of New York. The plea comes in response to a series of charges related to fraud and price manipulation in the digital asset space.

Cohen-Pavon's Legal Fate on the Horizon

Cohen-Pavon, who had previously faced an uncertain legal status due to his residency in Israel, has now pleaded guilty to multiple charges. These include conspiracy to commit price manipulation, securities fraud, manipulation of security prices, and wire fraud. As part of the plea agreement, he will remain free on bail until his sentencing hearing, scheduled for December 11, 2023.

The charges stem from allegations that former Celsius CEO, Alex Mashinsky orchestrated a scheme to artificially inflate the price of the Celsius token, thereby making substantial profits. Mashinsky, who has pleaded not guilty to all charges, allegedly earned approximately $42 million from these activities, while Cohen-Pavon is said to have gained roughly $3.6 million.

This development follows the U.S. Justice Department's announcement of charges against both former Celsius executives in July, marking a significant step in the legal proceedings against them. While Cohen-Pavon has opted to plead guilty, Mashinsky continues to contest the allegations and is currently free on a $40 million bond.

In addition to the legal actions against Mashinsky and Cohen-Pavon, U.S. authorities have frozen some of Mashinsky's assets, including specific bank accounts and a property located in Austin, Texas. This asset freezing aims to secure potential restitution for parties affected by the collapse of Celsius.

Lawyers, representing Mashinsky, filed a motion seeking the dismissal of the Federal Trade Commission's (FTC) case against him. Their argument hinges on the assertion that the allegations made by the FTC do not meet the necessary legal standards for a claim.

The broader implications of these legal battles extend to Celsius Network's ongoing bankruptcy case, which was filed in July 2022. A proposed settlement plan, put forth in August, is set to undergo review by a bankruptcy judge in October, potentially paving the way for resolution and restitution for affected parties.

Celsius Network Founder Arrested in New York

The Finance Magnates reported earlier that Mashinsky, the Founder of the cryptocurrency lender Celsius Network, was arrested in New York on July 13, 2023, following a series of lawsuits and regulatory actions by the United States Department of Justice (DOJ) and various regulators against him and the company. The DOJ complaint, filed in a New York district court, outlines seven counts of charges, encompassing securities, commodities, and wire fraud, along with allegations of token manipulation, targeting both Mashinsky and Cohen-Pavon.

As the legal saga surrounding Celsius and its former executives unfolds, it remains a closely watched case within the cryptocurrency industry, where regulatory scrutiny and legal accountability continue to evolve alongside the escalating digital asset market.