NFT Insider Trading Scandal: OpenSea Executive Found Guilty

Please fol­low and like us:
Pin Share

A for­mer prod­uct man­ag­er at the OpenSea NFT mar­ket­place was found guilty of fraud and mon­ey laun­der­ing in con­nec­tion with insid­er trad­ing on May 3.

Nathaniel Chas­tain alleged­ly used insid­er infor­ma­tion about the assets that would appear on OpenSea’s home page to make pur­chase decisions.

What is Known About the Case

Accord­ing to the report, the accused pur­chased non-fun­gi­ble tokens (NFTs) and then sold them soon. Which report­ed­ly earned him more than $50,000 in illic­it prof­it. The fed­er­al pros­e­cu­tors in Man­hat­tan described the case as the first insid­er trad­ing case involv­ing dig­i­tal assets.

Pros­e­cu­tor Thomas Bur­nett was quot­ed saying, 

“He abused his sta­tus at OpenSea to line his own pock­ets, and he lied to cov­er his tracks.” 

Accord­ing to pros­e­cu­tor Alli­son Nichols, Chas­tain used anony­mous OpenSea accounts to con­duct the illic­it trades. He argued that his actions demon­strat­ed that Chas­tain was aware of the wrong­ness of what he was doing.

Accord­ing to a spokes­woman for OpenSea, the busi­ness launched an inves­ti­ga­tion after becom­ing aware of Chastain’s alleged behav­ior and “ulti­mate­ly asked him to leave.”

NFTs Are ‘Not the Stock Market’

Accord­ing to an ear­li­er defense argu­ment, the for­mer prod­uct man­ag­er was not informed that his trade deci­sions were con­fi­den­tial. While Chastain’s attor­ney, Daniel Filor, did not con­test the trades, he claimed no one at the com­pa­ny had ever pro­hib­it­ed him from using or dis­clos­ing infor­ma­tion regard­ing which NFTs would be fea­tured on the home­page.

OpenSea Landing Page Featuring NFTs for Sale | OpenSea
OpenSea Land­ing Page Fea­tur­ing NFTs for Sale | OpenSea

On the ver­dict, Filor said, “We dis­agree, how­ev­er, with the jury’s ver­dict and we are eval­u­at­ing our options.”

The orig­i­nal charges were brought on last year, and Chas­tain has denied them ever since.

Accord­ing to the pros­e­cu­tion, Chas­tain bought rough­ly 45 NFTs. And he sold them for any­where from two to five times the orig­i­nal cost.

The case rais­es the issue of whether exist­ing may be used to bet­ter reg­u­late the cryp­tocur­ren­cy and NFT mar­kets. Par­tic­u­lar­ly now that the U.S. has lagged in super­vi­sion and the secu­ri­ties reg­u­la­tor has come under fire for its enforce­ment action.

“It’s not the stock mar­ket,” accord­ing to Filor.

The five-day tri­al on the case began last week and con­clud­ed on Wednes­day with a guilty verdict.

Disclaimer

In adher­ence to the Trust Project guide­lines, BeIn­Cryp­to is com­mit­ted to unbi­ased, trans­par­ent report­ing. This news arti­cle aims to pro­vide accu­rate, time­ly infor­ma­tion. How­ev­er, read­ers are advised to ver­i­fy facts inde­pen­dent­ly and con­sult with a pro­fes­sion­al before mak­ing any deci­sions based on this content.

Source link

Please fol­low and like us:
Pin Share

Leave a Reply

Your email address will not be published. Required fields are marked *