Celsius Denies Report Alex Mashinsky Attempted to Flee US

Celsius, the disgraced crypto-lending firm, denied on Tuesday that CEO Alex Mashinsky attempted to leave the United States for Israel last week.

“All Celsius employees — including our CEO — are focused and hard at work in an effort to stabilize liquidity and operations,” a spokesman said in a statement to media. “To that end, any reports that the Celsius CEO has attempted to leave the U.S. are false.”

BrightScope founder Mike Alfred made the claim on Sunday, saying Mashinsky was stopped by airport officials during an attempt to leave from New Jersey’s Morristown Airport. “Alex Mashinsky attempted to leave the country this week via Morristown Airport but was stopped by authorities,” Alfred wrote on Twitter. “Unclear at this moment whether he was arrested or simply barred from leaving.

“The thing that I keep thinking is that Mashinsky has almost certainly been contacted by the FBI already,” he added. “He may have even been picked up, questioned, and released. There is enough here that the Feds will want to examine. Celsius froze withdrawals 2 weeks ago, just days after Alex Mashinsky lied to customers about the safety of their funds. Mashinsky has gone silent and there is no sign that customer funds will be released anytime soon. It’s in the hands of the lawyers now, for better or worse.”

Celsius has been under scrutiny since it froze customer assets on June 13, calling it “necessary” for “our entire community.” The company held a $278 million on the Maker Protocol, and stood to lose $420 million in collateral if bitcoin sank below a price of $22,000. It managed to bring that figure down to $14,000 after freezing assets and making payments on the loan, but is still seeking to file for bankruptcy. The Wall Street Journal reported last week that it had hired restructuring consultants from advisory firm Alvarez & Marsal, along with attorneys from Akin Gump Strauss Hauer & Feld.

The company serviced 1.7 million users and held $11.8 billion in assets as of May, before imposing the freeze, with $8 billion in outstanding loans to its customers. Bitcoin’s price sank to $17,600 last weekend before a brief surge to nearly $22,000. As of Tuesday, it stood at $20,300 as it began another trend downward.

Mashinsky, a dual citizen of the U.S. and Israel originally from Ukraine, was vocally combative with his company’s critics on social media in the days leading up to the company’s announcement, but has been notably silent since a June 15 message that said his team was “working non-stop.”

Alfred opined on the company’s denial in a comment on Twitter, writing in response to a user who shared its statement. “If this is true, why is the executive team in hiding?” Alfred said. “Are you a paid full time employee of the company or are they just paying you under the table to post this crap? How about an update on when customers will start receiving their funds back? That’s what I thought. More BS.”