Failed Crypto Lender Celsius Fires Back, Accusing Ex-Employee of Fraud

KeyFi founder and CEO Jason Stone has previously filed suit against Celsius, accusing his former employer of market manipulation, among other charges.

AccessTimeIconAug 23, 2022 at 4:29 p.m. UTC
Updated Aug 23, 2022 at 5:47 p.m. UTC

Stephen Alpher is CoinDesk's co-regional news chief, Americas. He holds BTC and ETH above CoinDesk’s disclosure threshold of $1,000.

Bankrupt lender Celsius Network on Tuesday filed a countersuit against KeyFi and its CEO, Jason Stone, accusing the defendants of stealing valuable property from Celsius and demanding damages and restitution. Celsius acquired part of KeyFi in mid-2020.

"This action arises from the defendants' incompetence, deceit and conversion," according to the bankruptcy court filing by Celsius.

The lender labels KeyFi and Stone as "not just incompetent, they were also thieves." Further, according to Celsius, Stone and company used the recently banned Tornado Cash crypto "mixer" to cover any tracks left by their theft of assets.

"The defendants' liability to Celsius is staggering," said Celsius, saying funds lost through negligence alone are worth many tens of millions of dollars, with funds stolen possibly worth tens of millions more.

In early July, KeyFi and Stone filed suit against Celsius, accusing the company of crypto market manipulation and the lack of any accounting controls to protect consumer deposits.

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Stephen Alpher is CoinDesk's co-regional news chief, Americas. He holds BTC and ETH above CoinDesk’s disclosure threshold of $1,000.

CoinDesk - Unknown

Stephen Alpher is CoinDesk's co-regional news chief, Americas. He holds BTC and ETH above CoinDesk’s disclosure threshold of $1,000.

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