U.S. Charges ex-Coinbase manager in first Crypto Insider Trading Case
Insider trading was allegedly committed by a former product manager at OpenSea, the largest online exchange for non-fungible tokens, on Wednesday. This is the first instance of insider trading involving Digital Assets.
According to allegations, Nathaniel Chastain, 31, of Manhattan, covertly purchased 45 NFTs on 11 different occasions based on insider knowledge that the tokens—or others created by the same creator—would shortly be highlighted on OpenSea's home page.
Also Read: FBI Releases Public Alert Regarding Fraudulent Cryptocurrency Apps
According to the prosecution, Chastain chose which NFTs to highlight and sold them soon after, usually for two to five times what he paid.
When Chastain bought the NFT "Spectrum of a Ramenfication Theory" on September 14, 2021, and sold it at an early hour the next day, he purportedly more than doubled his money.
According to the prosecution, the conspiracy took place between June and September 2021, and Chastain carried out the transactions using accounts and anonymous Digital Currency Wallets at OpenSea, also known as Ozone Networks Inc.
NFTs might be fresh, but this kind of illegal enterprise is not, according to Manhattan U.S. Attorney Damian Williams.
"Today's accusations show the office's dedication to eradicating insider trading, whether it takes place on the stock market or the Blockchain," according to the statement.
Also Read: What Is Coinbase? | How To Use Coinbase Account
Before U.S. Magistrate Judge Barbara Moses in Manhattan on Wednesday, Chastain entered a not guilty plea to charges of wire fraud and money laundering, each of which carries a potential 20-year prison sentence.
The bond amount was $100,000.
According to Chastain's attorney David Miller, "we are convinced he will be exonerated when all the facts are disclosed."
Non-Fungible Tokens are distinct digital assets that are recorded on a blockchain and show ownership of things like artwork, other images, videos, and text.
According to the blockchain analytics company Chainalysis Inc., the NFT market had a value of nearly $40 billion in 2021 and more than $37 billion from January to April 2022, despite a levelling trend in transaction volume.
Also Read: Binance Served Crypto Traders For Years In Iran Despite U.S. Sanctions, Clients Reveal
In a statement concerning Chastain, OpenSea said, "When we learned of Nate's actions, we launched an inquiry and ultimately asked him to leave the company.
His actions were contrary to our core beliefs and guiding principles and in breach of our personnel policies.
Leave a Comment