Former OpenSea Employee Made 'Free Money' Off NFTs, Says US Prosecutor

Prosecutor said in his closing argument that Chastain chose which NFTs to feature, then profited illegally by selling his tokens shortly thereafter.

Former OpenSea Employee Made 'Free Money' Off NFTs, Says US Prosecutor

OpenSea did not start banning employees from buying or selling featured collections until September 2021

Highlights
  • Prosecutors have called it first such criminal insider trading case
  • The charges were first in a series of digital assets' high-profile cases
  • Chastain's lawyers said that his actions were not insider trading
Advertisement

A former employee of OpenSea, the world's largest marketplace for non-fungible tokens (NFTs), used inside knowledge of which assets would be featured on its homepage to make "free money," a prosecutor said on Monday as an insider trading trial wound to a close.

The charges against Nathaniel Chastain, a former OpenSea product manager, were the first in a series of high-profile cases related to digital assets launched by the US Attorney's office in Manhattan last year. Prosecutors have called it the first criminal insider trading case involving such assets.

Prosecutor Thomas Burnett said in his closing argument that Chastain chose which NFTs to feature, and then profited illegally by selling his tokens shortly thereafter. He made upwards of $50,000 (nearly Rs. 40 lakh) off such trades before getting caught in September 2021, Burnett said.

"He was using OpenSea's information like his own piggy bank," Burnett told the jury. "It was as good as free money."

Chastain's lawyers were expected to give their closing argument later on Monday. They have said that his actions were not insider trading, and that the information he accessed was not OpenSea's property and had no inherent value to the company.

Chastain's lawyers have also said OpenSea did not start banning employees from buying or selling featured collections or creators until Chastain's last day, in September 2021. The company did not treat such information as confidential while Chastain worked there, his lawyer David Miller has argued.

Chastain faces one count of wire fraud and one count of money laundering. His trial before US District Judge Jesse Furman in Manhattan began last week.

The case could have broader implications for assets that do not fit into existing regulations preventing investment advisers, brokers and others from trading on material nonpublic information, legal experts have said.

© Thomson Reuters 2023


OnePlus Nord CE 3 Lite launched in India with a sub-Rs.20,000 price tag. How does it perform against the competition. We discuss this and more on Orbital, the Gadgets 360 podcast. Orbital is available on Spotify, Gaana, JioSaavn, Google Podcasts, Apple Podcasts, Amazon Music and wherever you get your podcasts.
Affiliate links may be automatically generated - see our ethics statement for details.
Comments

For details of the latest launches and news from Samsung, Xiaomi, Realme, OnePlus, Oppo and other companies at the Mobile World Congress in Barcelona, visit our MWC 2024 hub.

Further reading: OpenSea, OpenSea NFT, NFT, digital assets
Google Pixel 7a Unboxing Images Tip Arctic Blue, Carbon Black Colour Options
FAA Sued by Environmentalists Over SpaceX's Rocket Launch License for Texas
Share on Facebook Gadgets360 Twitter Share Tweet Snapchat Share Reddit Comment google-newsGoogle News
 
 

Advertisement

Follow Us

Advertisement

© Copyright Red Pixels Ventures Limited 2024. All rights reserved.
Trending Products »
Latest Tech News »