Alex Mashinsky, CEO and founder of bankrupt crypto lending firm Celsius, and Brett Harrison, president of FTX US, both resigned from their respective posts Tuesday.
Mashinsky’s resignation comes amid bankruptcy proceedings his company initiated in July.
“I regret that my continued role as CEO has become an increasing distraction, and I am very sorry about the difficult financial circumstances members of our community are facing,” Mashinsky wrote in his resignation letter. “Since the pause, I have worked tirelessly to help the Company and its advisors put forward a viable plan ... to return coins to creditors in the fairest and most efficient way.”
Under Mashinsky’s watch, Celsius froze customer withdrawals in June over liquidity issues and was hit with a lawsuit by a former employee the following month accusing the firm of being a Ponzi scheme. Its bankruptcy filing in July revealed a $1.19 billion deficit.
CNBC reported in August that hundreds of Celsius’ 1.7 million customers had written letters urging the U.S. District Court for the Southern District of New York to help them access the money they had invested with Celsius, and that some of them were “homeless, suicidal, and down to the last $1,000.”
Celsius CFO Chris Ferraro, former head of financial analysis at JPMorgan Chase, will step up as interim CEO and chief restructuring officer, according to a bankruptcy court filing. Ferraro joined the company in March as head of financial planning and analysis (FP&A) and investor relations, and rose to the CFO role in July, according to his LinkedIn profile.
Mashinsky will remain on Celsius’ board of directors. He said he will “continue to maintain [his] focus on working to help the community unite behind a plan that will provide the best outcome for all creditors.”
Harrison’s resignation comes just one day after FTX US won the bid to buy Voyager Digital’s assets for more than $1.4 billion.
Harrison announced his resignation via Twitter on Tuesday, saying he’d be “transferring [his] responsibilities and moving into an advisory role” at FTX US.
Zach Dexter has replaced Harrison in FTX US’s top spot. Dexter joined the company in August 2021, when FTX US began its acquisition of LedgerX, a crypto platform which he co-founded. The acquisition was finalized last October.
Harrison has not yet disclosed his post-FTX US plans, but said he’d be “assisting [FTX CEO Sam Bankman-Fried] and the team with this transition to ensure FTX ends the year with all its characteristic momentum.”
In a twist that could entwine the Celsius and FTX US moves, Bankman-Fried is considering buying Celsius’ assets, Bloomberg reported Tuesday, citing an anonymous source familiar with the matter.
Harrison had served in FTX US’s top role since last year, growing the company from three employees to more than 100. In his resignation tweet, he reflected on his time at the firm, “working together to build a nascent crypto exchange into a multi-business enterprise; writing a retail equities trading platform and building a US brokerage; acquiring LedgerX and Embed; getting to know and work with regulators and lawmakers; participating in shaping crypto policy in the US; and many more.”
Mashinsky and Harrison’s resignations come less than a week after crypto exchange Kraken CEO Jesse Powell stepped down from the company he founded 11 years ago, a decision he’d been mulling for “quite some time.”
The resignations come amid a crypto winter, the digital asset space’s equivalent to a bear market, which has seen the price of Bitcoin nosedive from a mid-November high of more than $68,000 to around $19,500 Wednesday.