• The SEC has fined former Coinbase product manager Ishan Wahi for insider trading.
• He allegedly shared confidential listing information with his brother and a friend who made financial profits from the trades.
• The SEC’s Division of Enforcement emphasized that the federal securities laws do not exempt crypto asset securities from the prohibition against insider trading.
SEC Fines Coinbase’s Former Product Manager for Insider Trading
The Securities and Exchange Commission (SEC) has accused former Coinbase product manager Ishan Wahi of engaging in a scheme to trade ahead of multiple announcements related to at least nine crypto asset securities, resulting in fines. Ishan was alleged to have disclosed upcoming listing details to his brother, Nikhil Wahi, and a friend, Sameer Ramani, who profited from illicit trades.
Details Of The Alleged Insider Trading Scheme
Ishan had access to confidential information as a product manager at Coinbase and allegedly shared this information with his brother who used it to make illicit trades. Between June 2021 and April 2022, Nikhil and Ramani purportedly took advantage of this nonpublic information to trade at least 25 crypto assets, nine of which were securities. They timed their purchases strategically before the official announcements followed by selling them for substantial profits following the anticipated price surge.
Gurbir S Grewal’s Statement On SEC Investigation
Gurbir S Grewal, Director of the SEC’s Division of Enforcement stated that “The federal securities laws do not exempt crypto asset securities from the prohibition against insider trading”. This statement implies that cryptocurrency isn’t exempt from insider trading regulations and those found guilty will have to face consequences accordingly.
Coinbase’s Internal Policies Against Insiders Trading
Coinbase had clear policies prohibiting such actions like Ishan’s but he still indulged in disclosing confidential information which led him into trouble with the regulatory authority..
By fining Ishan Wahi and his brother for their involvement in an illegal insider trading scheme pertaining cryptocurrencies, the SEC has once again enforced its stance on preserving market integrity by upholding fair practices within cryptocurrency markets as well as other industries where similar rules apply.