Federal prosecutors have asked a New York judge to consider a reduced sentence for former Celsius executive Roni Cohen‑Pavon, saying his cooperation has been “substantial” in the long-running prosecution that followed the crypto lender’s collapse.
In a letter filed Monday in the U.S. District Court for the Southern District of New York, U.S. Attorney Jay Clayton told Judge John Koeltl that Cohen‑Pavon assisted investigators — including preparing to testify against former Celsius CEO Alex Mashinsky. Prosecutors asked the court to apply sentencing guidelines that permit reductions for defendants who provide such assistance, rather than recommending a fixed prison term.
Cohen‑Pavon pleaded guilty in September 2023 to fraud and conspiracy tied to manipulation of CEL, the native token of Celsius. Court records link his actions to maneuvers that regulators and prosecutors say helped precipitate the platform’s 2022 collapse and billions in investor losses. Defense lawyers have urged the judge to impose time served, arguing Cohen‑Pavon has accepted responsibility and acknowledged the harm caused.
Prosecutors said Cohen‑Pavon’s cooperation became public soon after his guilty plea and likely influenced Mashinsky’s decision to plead guilty ahead of a January 2025 trial. Mashinsky later received a 12‑year prison sentence in May 2025 after admitting to commodities and securities fraud; authorities allege he misled customers about the safety of deposits and the company’s financial state. Earlier DOJ filings accused Mashinsky and Cohen‑Pavon of working together to inflate CEL’s price while presenting the token as a stable investment to users. An independent examiner during the bankruptcy process even concluded Celsius operated in a manner similar to a Ponzi scheme.
The sentencing hearing for Cohen‑Pavon — originally scheduled for May 7 — was moved to May 13, according to the court filing. The broader legal fallout has already produced additional penalties: in April 2026 the Federal Trade Commission reached a settlement with Mashinsky that bars him from promoting or offering asset‑related services, includes a $4.72 billion judgment (mostly suspended), and requires a $10 million payment tied to a DOJ forfeiture arrangement.
Why it matters: Cohen‑Pavon’s cooperation appears to be a key piece in unraveling leadership conduct at one of crypto’s most high‑profile failures. The court’s decision on his sentence will be watched closely by regulators, industry participants and investors as a bellwether for accountability in crypto lending and token issuance cases.
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