- The Department of Justice has arrested a former Coinbase employee in the first case of cryptocurrency insider trading.
- The employee, a former chief product officer, allegedly used his knowledge of asset listings to engage in several counts of insider trading.
- Previously, the Justice Department charged a former Open Sea employee with insider trading NFT.
Ishan Wahi, a former product manager for the publicly listed cryptocurrency exchange Coinbase, was arrested this morning for an insider trading scheme during his time with Coinbase, by a Release of the Ministry of Justice.
Ishan worked together with his brother Nikhil Wahi and Sameer Ramini to commit “a fraud conspiracy and wire fraud in a scheme to engage in insider trading in cryptocurrency assets using information confidential information from Coinbase about crypto assets that were to be listed on Coinbase exchanges,” according to the statement.
This is the first-ever arrest for insider trading within the cryptocurrency ecosystem, and as such, US Attorney Damian Williams said:
“Today’s charges are yet another reminder that Web3 is not a lawless zone. Last month I announced the first insider trading case involving NFTsand today I am announcing the first-ever case of insider trading involving cryptocurrency markets.
Williams went on to say, “Our message with these charges is clear: fraud is fraud is fraud, whether it happens on the blockchain or on Wall Street.”
Nikhil was also arrested early this morning along with Ishan, but Ramini is still at large. Williams closed his statement by detailing the Justice Department’s relentless pursuit to close this, and more matters to come.
“And the Southern District of New York will continue to be relentless in bringing fraudsters to justice wherever we may find them,” Williams said.
Michael Driscoll, Deputy Director of the Federal Bureau of Investigation (FBI), explained that the defendants generated ill-gotten gains totaling more than $1.5 million by exploiting inside information to trade at least 25 different cryptocurrencies, because Ishan was an integral part of the list of such assets. .