US Prosecutors Seek Leniency for Ex-Celsius Exec Roni Cohen-Pavon

Federal prosecutors have recommended leniency for Roni Cohen-Pavon, the former Chief Revenue Officer of Celsius Network, citing his cooperation in the fraud investigation against Celsius's founder, Alex Mashinsky. Cohen-Pavon, who pleaded guilty in September 2023 to fraud and price manipulation tied to Celsius’s native CEL token, is scheduled for sentencing on May 13, 2026.

In a letter submitted to the U.S. District Court for the Southern District of New York, U.S. Attorney Jay Clayton emphasized Cohen-Pavon’s "substantial assistance" in Mashinsky’s case. His cooperation reportedly played a key role in Mashinsky’s decision to plead guilty ahead of his January 2025 trial. Mashinsky is now serving a 12-year prison sentence for securities and commodities fraud linked to Celsius’s collapse in 2022.

Cohen-Pavon admitted to participating in a CEL token price manipulation scheme that contributed to Celsius’s downfall. At its peak, the crypto lender managed nearly $12 billion in assets and was a cornerstone of the industry. However, reckless asset management, unsustainable yields, and a liquidity crisis forced it into Chapter 11 bankruptcy in July 2022, with billions in customer funds lost.

The fallout from Celsius was part of a wider crypto market meltdown that also saw the collapse of FTX and Voyager Digital. Celsius’s bankruptcy proceedings revealed a significant asset-liability deficit and sparked intense regulatory scrutiny. Ultimately, the company exited bankruptcy in January 2024 with a court-approved restructuring plan, which included distributing over $3 billion in assets to creditors and establishing a Bitcoin mining firm, Ionic Digital.

Prosecutors have not recommended a specific sentence for Cohen-Pavon but asked the judge to consider his cooperation when determining his punishment. His legal team, meanwhile, has requested time served, asserting that Cohen-Pavon has taken full responsibility for his actions.

For traders and crypto investors, the Celsius case is a stark reminder of the systemic risks inherent in centralized crypto platforms. The CEL token, once hyped as a high-yield opportunity, became emblematic of over-leveraged business models in the crypto lending sector.

Cohen-Pavon’s sentencing is expected to finalize the criminal cases tied to Celsius, closing a chapter in one of crypto’s most high-profile collapses. However, its broader implications, including regulatory reforms and investor skepticism, will likely reverberate for years.