After initially pleading not guilty last year, 32-year-old Ishan Wahi pleaded guilty to two counts of conspiracy to commit wire fraud.
Coinbase said it shared its findings from an internal probe into the trading with prosecutors
Photo Credit: Unsplash/ Bermix Studio
A former Coinbase product manager pleaded guilty on Tuesday in what US prosecutors have called the first insider trading case involving cryptocurrency, his defence lawyer said in a court hearing.
Ishan Wahi, 32, pleaded guilty to two counts of conspiracy to commit wire fraud, after initially pleading not guilty last year.
Prosecutors said Wahi shared confidential information with his brother Nikhil and their friend Sameer Ramani about forthcoming announcements of new digital assets that Coinbase would let users trade.
"I knew that Sameer Ramani and Nikhil Wahi would use that information to make trading decisions," Ishan Wahi said during Tuesday's hearing in federal court in Manhattan. "It was wrong to misappropriate and disseminate Coinbase's property."
Nikhil Wahi and Ramani were charged with using Ethereum blockchain wallets to acquire digital assets and trading at least 14 times before Coinbase announcements between June 2021 and April 2022.
The announcements typically caused the assets to rise in value and generated at least $1.5 million (roughly Rs. 12 crore) in illicit gains, prosecutors have said.
Nikhil Wahi pleaded guilty in September to a wire fraud conspiracy charge, and in January was sentenced to 10 months in prison. Ramani is at large.
As part of a plea deal, prosecutors stipulated that sentencing guidelines called for Ishan Wahi to be imprisoned for between 36 and 47 months. US District Judge Loretta Preska scheduled his sentencing hearing for May 10.
Coinbase is one of the world's largest cryptocurrency exchanges. The company has said it shared its findings from an internal probe into the trading with prosecutors.
On Monday, Ishan Wahi asked a judge to dismiss a parallel lawsuit from the Securities and Exchange Commission (SEC), saying that charges represent an "abuse of power" by the agency. At issue is whether nine tokens listed on Coinbase were, in fact, securities and subject to SEC regulation.
A spokesperson for the SEC declined to comment.
In pleading guilty to the criminal charges on Tuesday, Ishan Wahi said he did not believe any of the relevant tokens were securities. Noah Solowiejczyk, a prosecutor, said the question of whether or not the tokens are securities was not an element of prosecutors' case.
© Thomson Reuters 2023
Cryptocurrency is an unregulated digital currency, not a legal tender and subject to market risks. The information provided in the article is not intended to be and does not constitute financial advice, trading advice or any other advice or recommendation of any sort offered or endorsed by NDTV. NDTV shall not be responsible for any loss arising from any investment based on any perceived recommendation, forecast or any other information contained in the article.
For the latest tech news and reviews, follow Gadgets 360 on X, Facebook, WhatsApp, Threads and Google News. For the latest videos on gadgets and tech, subscribe to our YouTube channel. If you want to know everything about top influencers, follow our in-house Who'sThat360 on Instagram and YouTube.