Alexander Mashinsky, the former CEO of Celsius Network Inc., along with co-founders Shlomi Daniel Leon and Hanoch Goldstein, will collectively pay $16.5 million to settle charges from the Federal Trade Commission (FTC). The FTC accused them of deceiving users by falsely claiming that deposits on their cryptocurrency platform were safe and always accessible.

The allegations stem from a complaint filed in July 2023, where the FTC stated that Celsius and its executives misrepresented the safety of consumer deposits, claiming they were 'safer' than traditional banks. They also falsely assured users that they could withdraw their funds at any time and that the company had a $750 million insurance policy to protect deposits.

As part of the settlement, Mashinsky will pay $10 million, Leon will pay $4.1 million, and Goldstein will pay $2.4 million. Additionally, they are banned from marketing or selling any products related to cryptocurrency deposits or withdrawals. The orders also prohibit them from making false representations about any products or services and from violating consumer privacy laws.

The FTC's decision was unanimously approved, with the stipulated final orders requiring court approval to take effect. The case highlights the regulatory scrutiny facing cryptocurrency platforms and the importance of transparency in financial services.