USDThis Week’s Legal Shockwaves Hit Celsius, Nike, FTX, and Tornado Cash
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DOJ Seeks 20-Year Sentence for Celsius Founder Mashinsky, CEL Soars Amid Fraud Allegations
The US Department of Justice (DOJ) has requested a 20-year prison sentence for Celsius Network founder Alex Mashinsky, citing serious financial misconduct and deception that led to significant losses for thousands of customers. The request coincided with an 80% rally in CEL, Celsius's native token, which surged from below $0.06 to nearly $0.18 before settling around $0.14, though this remains far from its all-time high of over $8. Mashinsky has pled guilty to commodities and securities fraud, profiting $48 million by misleading investors about the company's “Earn” program. Celsius, once a leading crypto lending platform, filed for Chapter 11 bankruptcy in 2022, revealing a $1.2 billion shortfall and $4.7 billion in debts. Since then, it has begun distributing over $3 billion to affected users, reaching 93% of this amount to over 250,000 creditors across 165 countries by August 2024. The sentencing is scheduled for May 8.
Monero Price Surges 50% After $330M Bitcoin Theft Linked to Laundering Scheme
On April 28, 2025, an astonishing 50% surge in Monero's price followed a reported $330 million Bitcoin theft, flagged by on-chain analyst ZachXBT. A transaction involving 3,520 BTC, moved from a victim's wallet to a new address, was swiftly laundered through various exchanges into Monero. This spike propelled XMR to an intraday high of $339, although it then settled to $289, representing a 25% increase in the last 24 hours. ZachXBT dismissed theories suggesting involvement by North Korea’s Lazarus Group, indicating independent hackers as the likely culprits. Despite privacy coins like Monero gaining traction, Chainalysis noted that most criminal transactions still occur with mainstream cryptocurrencies due to their high liquidity. In a positive development for Monero, select Spar stores in Switzerland have started accepting it for payments, marking a notable shift in retail acceptance.
Bitget Takes Legal Action Against Eight Traders for $20M VOXEL Price Manipulation
Cryptocurrency exchange Bitget is pursuing legal action against eight account holders accused of manipulating VOXEL perpetual futures contracts, resulting in over $20 million in unlawful profits during an incident on April 20, 2025. Xie Jiayin, Bitget's head of Chinese operations, announced on April 27 that the legal team would quickly notify the implicated accounts, identifying them as primary instigators of the manipulation. Following the detection of unusual trading activity, with trading volumes exceeding $12 billion, Bitget froze suspicious accounts and reversed irregular trades. CEO Gracy Chen confirmed that the platform remained secure and that affected users would receive 100% of the recovered funds via airdrops. Speculation suggests that a market maker bot flaw inflated trading volumes, which traders exploited through high-leverage positions. This case echoes a similar incident involving Hyperliquid, where liquidation mechanisms were exploited, leading to a $6.26 million profit from JELLY futures.
Nike Faces Class-Action Lawsuit Over RTFKT NFT Platform Shutdown
Nike is facing a class-action lawsuit filed on April 25, 2025, in Brooklyn federal court by RTFKT NFT holders, alleging a "rug pull" following the abrupt shutdown of its RTFKT NFT platform earlier this year. Led by Jagdeep Cheema, plaintiffs claim Nike misled investors by marketing sneaker-themed NFTs as unregistered securities, promising long-term value appreciation without SEC registration, and seek $5 million in damages for consumer protection and unfair competition law violations. The lawsuit focuses on Nike's acquisition of RTFKT Studios in December 2021 and promotion of RTFKT Nike Cryptokicks NFTs, which peaked at an average value of 3.5 Ether ($8,000) in April 2022, plummeting to just 0.009 Ether ($16) after the platform's closure in January 2025. With a 63% decline in total NFT sales year-over-year in Q1 2025, the RTFKT platform's collapse further impacted disillusioned holders amid a challenging NFT market.
Texas Court Blocks U.S. Treasury from Reimposing Sanctions on Tornado Cash
A Texas District Court has issued a permanent injunction preventing the U.S. Treasury Department from reimposing sanctions on Tornado Cash, a cryptocurrency mixing service. This decision follows a November ruling by the Fifth Circuit Court that was unfavorable to the government, which subsequently sought delays and argued that the issue was moot after removing Tornado Cash from the sanctions list. The Texas court's recent order secures Tornado Cash from any future U.S. sanctions, reinforcing its legal standing and operational continuity within the evolving landscape of cryptocurrency regulation and compliance, following significant legal challenges against governmental actions.
FTX Sues NFT Stars and Kurosemi to Recover Crypto Assets Amid Bankruptcy Recovery Efforts
FTX has filed lawsuits against NFT Stars and Kurosemi to recover crypto assets linked to pre-bankruptcy agreements, specifically Simple Agreements for Future Tokens (SAFTs). Allegations include NFT Stars failing to return 1.35 million SENATE tokens and 135 million SIDUS tokens after receiving $325,000, while Kurosemi did not provide 75 million $AGI tokens following a $1 million investment. These lawsuits are part of FTX's larger strategy to recover funds for creditors post-bankruptcy, as the exchange aims to maximize asset recovery amidst a complex legal landscape affecting thousands of investors left in limbo after its 2022 collapse.
US Treasury Proposes Ban on Cambodia's Huione Group Over Money Laundering Links to North Korea
The US Treasury Department's FinCEN has proposed banning Cambodia-based Huione Group from the US financial system due to allegations of money laundering linked to North Korean hacker groups, which reportedly laundered over $4 billion between 2021 and 2025. Huione is accused of facilitating cybercrime through an online marketplace and payment services for cryptocurrencies. Of the laundered funds, $37 million was in cryptocurrencies tied to North Korean cyber heists. This action aims to cut off Huione's access to banking, enhancing efforts to combat money laundering. Additionally, the National Bank of Cambodia revoked Huione's local banking license in March 2025.
This article has been refined and enhanced by ChatGPT.
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