The U.S. Department of Justice (DOJ) arrested former Coinbase product manager Ishan Wahi and his brother, Nikhil Wahi, on allegations of wire fraud in a first-ever cryptocurrency insider trading scheme, the agency said in a statement on Thursday.
See related article: Former OpenSea employee arrested amid insider trading allegations
Fast facts
- The Wahi brothers are in custody while Ishan’s associate, Sameer Ramani, who’s also been charged with wire fraud, is still at large.
- The DOJ alleged that Ishan leaked confidential information regarding assets to be listed on Coinbase as well as the time of the listing’s public announcement to Nikhil and Ramani on at least 14 occasions between June 2021 and April 2022.
- Based on Ishan’s tips, Nikhil and Ramani purchased assets shortly before the Coinbase listing announcements using anonymous Ethereum wallets and centralized exchange accounts held in the name of others, the DOJ alleged.
- The duo earned about US$1.5 million through such trades involving at least 25 different assets, the agency said.
- The U.S. Securities and Exchange Commission (SEC), which assisted in the DOJ investigation, has separately charged the defendants with securities fraud in a civil case, but Coinbase called it a “distraction” since assets listed on the exchange are not securities.
See related article: Binance faces US probe for possible insider trading and market manipulation
