Former Coinbase Manager Gets 10-Month Prison Term
- Nikhil Wahi, the brother of Ishan Wahi, a former product manager at Coinbase, entered a guilty plea and was sentenced to 10 months in prison for using his family ties to engage in insider trading of cryptocurrency tokens.
- In June 2022, a lawsuit alleging insider trading involving digital assets was brought up against Nathaniel Chastain, a former employee of OpenSea.
Nikhil Wahi, the brother of Ishan Wahi, a former product manager at Coinbase, entered a guilty plea and was sentenced to 10 months in prison for using his family ties to engage in insider trading of cryptocurrency tokens.
The conspirator will be required to refund the $892,000 in gains from those transactions.
“I made a huge mistake, a terrible mistake,” said Nikhil to US District Judge Loretta Preska on Tuesday. “It’s something that I will have to live with forever.”
U.S. Attorney Damian Williams noted that this was the first occasion “a defendant has admitted guilt in an insider trading case involving the cryptocurrency markets” after the defendant’s guilty plea in September. Ishan Wahi, in contrast, entered a not-guilty plea in August.
Although Nikhil’s 10-month term is much less than the 20-year maximum punishment that wire fraud offenders can receive, the brother, who sought no jail time at all, is disappointed in the outcome. Prosecutors, on the other hand, wanted to see him serve up to 16 months in jail. Nikhil will be sent back to India after serving his punishment.
Ishan Wahi was invited by Coinbase to a meeting on May 16, 2022, due to rumors that he might be participating in such illegal behavior.
The present state of the economy caused Coinbase to fire another 950 workers on Tuesday
In June 2022, a lawsuit alleging insider trading involving digital assets was brought up against Nathaniel Chastain, a former employee of OpenSea. Chastain was accused of making investments in NFTs just before he learned they would be listed by the market, similar to the Wahi brothers.
In September 2021, on-chain investigators discovered Chastain’s dubious activities; she was promptly sacked from OpenSea.
However, Chastain filed a motion to dismiss those allegations against him in August. His attorneys said that because NFTs had not yet been designated as securities or commodities, he technically had breached no laws.
“The government… should not be permitted to proceed on a Carpenter wire fraud theory of insider trading when it agrees that the relevant pieces of “digital artwork” are not securities,” read the filing.
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