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Former Celsius CEO Withdrew $10M Ahead of Bankruptcy to ‘Pay Taxes’

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Former Celsius CEO Alex Mashinsky withdrew $10 million in May to pay state and federal taxes and also used it for ‘estate planning.’ A spokesperson for Mashinsky said that he had deposited crypto that equaled what he withdrew.

Alex Mashinsky, the former Chief Executive Officer of the collapsed Celsius Network, has withdrawn millions to pay state and federal taxes in the weeks leading to the company’s bankruptcy filing. People close to the matter told the Financial Times that he had withdrawn $10 million from the company in May of this year as the crypto market was bleeding

The decision to withdraw funds during the time sparked concern, with the crypto community asking if Mashinsky knew the company would be in financial straits following the market crash. The report also says that the people familiar matter said that $8 million was used to pay taxes for the income generated on assets on Celsius, while the remaining $2 million was in CEL tokens and utilized for “estate planning.”

A spokesperson for Mashinsky said that he and his family still had $44 million of crypto frozen with Celsius, and that had been disclosed during the bankruptcy proceedings. However, he also pointed out that he had deposited funds that equaled what he had withdrawn to pay taxes. The spokesperson said,

“In mid to late May 2022, Mr. Mashinsky withdrew a percentage of cryptocurrency in his account, much of which was used to pay state and federal taxes. In the nine months leading up to that withdrawal, he consistently deposited cryptocurrency in amounts that totalled what he withdrew in May,”

Such behavior has undoubtedly raised eyebrows about Mashinsky, who was already in hot water. As pointed out by FatMan from the Terra community, he had been withdrawing funds as he was claiming the company had “adequate reserves.”

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