Celsius founder took out $10 million before pausing withdrawals and filing for bankruptcy

The sketchier things are for the Celsius Network.

According to the Financial Times, Alex Mashinsky withdrew $10 million from his company just weeks before it froze withdrawals.

One of the first institutions to feel the effects of the crash was Celsius. As rumors of insolvency began to spread online, Celsius reassured customers that there were no issues with their investments. All withdrawals would be paused and customer accounts would be frozen.

In July, Celsius would file for Chapter 11. The lender said it had more than $150 million on hand. $4.7 billion is due to Celsius customers.

A spokesman for Mashinsky told the Financial Times that he had $42 million in frozen assets.

The company would deny its customers the ability to do the same if it withdrew $10 million from its founder. There are other aspects of Celsius that are a problem.

The Vermont Department of Financial Regulation supported the claims that Celsius was a Ponzi scheme by accusing it of doing the same thing.

"This shows a high level of financial mismanagement and also suggests that, at some point in time, yields to existing investors were probably being paid with the assets of new investors."

Paying out existing investors is a Ponzi scheme.

Celsius advertised their services as benefiting the little guy and ignoring the old financial institutions. The foresight in withdrawing $10 million from his company is proof that the claims are false.