Federal authorities filed criminal and civil charges against a former Coinbase employee and two other men in an insider-trading case involving confidential information about cryptocurrency assets that were about to be posted on Coinbase’s exchange. All three of the men were involved in trades over nearly a year using information about 14 listings on Coinbase and generated about $1.5 million in illegal profits. The men were charged criminally with three counts of wire fraud and conspiracy to commit wire fraud. This case is the first time authorities have filed criminal insider-trading charges involving cryptocurrency.
The prosecutors and SEC claim Ishan Wahi, who at the time was part of a Coinbase team that listed assets on the exchange, shared confidential information about when some cryptocurrency assets would be listed with his brother, Nikhil Wahi, and his brother’s friend Sammer Ramani. Authorities say Nikhil Wahi and Mr. Ramani then used that information to buy the assets before Coinbase announced they would be listed. After the announcement, the men sold the assets for a profit. This alleged ploy was discovered after an internal investigation at Coinbase in April following a Twitter post about unusual trading.
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