The brother of a former Coinbase product supervisor has pleaded responsible in a cryptocurrency insider buying and selling case. According to the U.S. Department of Justice (DOJ), he’s dealing with as much as 20 years in federal jail.
DOJ’s First Crypto Insider Trading Case
The U.S. Department of Justice (DOJ) introduced Monday that Nikhil Wahi, the brother of a former product supervisor at Coinbase Global Inc. (Nasdaq: COIN), “pled guilty to one count of conspiracy to commit wire fraud in connection with a scheme to commit insider trading in cryptocurrency assets.” The DOJ calls it the “first-ever cryptocurrency insider trading case.” Nikhil Wahi was arrested in July.
His brother, Ishan Wahi, labored at Coinbase as a product supervisor assigned to the cryptocurrency buying and selling platform’s asset itemizing staff starting in October 2020.
The Justice Department defined that on a number of events between July 2021 and May 2022, Nikhil Wahi profited from utilizing “confidential Coinbase information about which crypto assets were scheduled to be listed on Coinbase.”
After getting suggestions from his brother as to which crypto belongings Coinbase was planning to checklist on its exchanges, Nikhil Wahi “used anonymous Ethereum blockchain wallets to acquire those crypto assets shortly before Coinbase publicly announced the listings,” the DOJ detailed, elaborating:
Following Coinbase’s public itemizing bulletins, on a number of events Nikhil Wahi bought the crypto belongings for a revenue.
The DOJ defined that to hide his purchases, Nikhil Wahi “used accounts at centralized exchanges held in the names of others, and transferred funds, crypto assets, and proceeds of their scheme through multiple anonymous Ethereum blockchain wallets.”
Nikhil Wahi “also regularly created and used new Ethereum blockchain wallets without any prior transaction history in order to further conceal his involvement in the scheme,” the Justice Department added, noting:
Nikhil Wahi, 26, of Seattle, Washington, pled responsible to at least one rely of conspiracy to commit wire fraud, which carries a most sentence of 20 years in jail.
The U.S. Securities and Exchange Commission (SEC) additionally slapped the 2 brothers and their pal with insider buying and selling fees. Nikhil Wahi and the pal “allegedly purchased at least 25 crypto assets, at least nine of which were securities, and then typically sold them shortly after the announcements for a profit. The long-running insider trading scheme generated illicit profits totaling more than $1.1 million,” the SEC detailed.
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