SEC Lawsuit Sparks Further Drop in CEL Token Price

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The SEC has taken enforcement action against Celsius Network, a cryptocurrency lending company that collapsed in 2022. The Commission has filed a lawsuit against the company and its former CEO Alex Mashinsky. However, details of the complaint are not available at the moment.

The lawsuit comes after the US Commodity Futures Trading Commission (CFTC) found Celsius and Mashinsky guilty of breaking several laws prior to the company’s collapse in 2022. Consequently, Mashinsky was arrested on Thursday morning. He will face arraignment in court on Friday.

The CFTC enforcement division lawyers have determined that Mashinsky violated several US regulations while Celsius Network misled investors and neglected to register with the regulator. The SEC and CFTC investigations began when Celsius announced that it had started voluntary Chapter 11 proceedings.

The New York Attorney General Letitia James filed a lawsuit against Mashinsky in January 2023, accusing him of making numerous “false and misleading statements” which resulted in investors losing billions. However, the company has $167 million in cash which it claims will enable it to support “certain operations during the restructuring process.”

The news of the SEC lawsuit has had a negative impact on the price of CEL, Celsius Network’s native token. At the time of writing, it is trading at $0.1543, down by 3.74% in the last 24 hours. It had hit a daily low of $0.1486 following the news. While it had recovered from the fall resulting from the CFTC conclusion, it is not clear if it will fully recover from today’s dip.

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