Troubled crypto lending platform Celsius filed a countersuit in United States Bankruptcy Court on Tuesday against Jason Stone and his company KeyFi. In the filing, Celsius alleges Stone falsely represented himself as a pioneer and expert in coin staking and decentralized finance (DeFi) investments.

"Unfortunately, Defendants Stone and KeyFi, Stone's majority-owned corporate vehicle, proved themselves incapable of deploying coins profitably and appear to have lost thousands of Celsius coins through their gross mismanagement,” Celsius says. “But the Defendants were not just incompetent, they also were thieves."

The Celsius countersuit alleges Stone and KeyFi stole millions of dollars in coins from Celsius-controlled wallets, transferring them to wallets that they owned. The suit also alleges that Stone used Celsius coins to buy hundreds of NFTs, sending them to their own wallets.


NFTs, or non-fungible tokens, are cryptographically unique tokens that are linked to digital (and sometimes physical) content, providing proof of ownership.

"Stone and/or KeyFi also appear to have used Celsius coins to acquire for themselves interests in numerous blockchain-related companies and platforms that they continue wrongfully to hold," the countersuit says.

Stone, whose KeyFi was acquired by Celsius in 2020, sued Celsius in July for allegedly refusing to honor its contract. In the lawsuit, KeyFi alleges Celsius used customer funds to "manipulate crypto asset markets, had failed to institute basic accounting controls which endangered those same deposits and had failed to carry through on promises."

That same month, Celsius filed for Chapter 11 bankruptcy protection a month after the company paused all customer withdrawals and swaps, citing liquidity issues prompting regulators from Alabama, Kentucky, New Jersey, Texas, and Washington to open investigations.

Celsius also alleges that Stone used the sanctioned Tornado Cash mixing service to obfuscate his transfers' origin, destination, and counterparties. The suit alleges that Stone sent $1.4 million through Tornado Cash in September 2021.


In the countersuit, Celsius asked for the court to approve several requests, including the turning over of "withheld property" that may have come into the defendants' possession. Awarding damages, including for what Celsius calls "[KeyFi and Stone's] tortious, willful and malicious conduct."

Daily Debrief Newsletter

Start every day with the top news stories right now, plus original features, a podcast, videos and more.