Last April, a potential insider trading was spotted on the Coinbase platform. Following this, the latter investigated to identify three suspects, including one of its employees. The latter was fired and all three are now dealing with American justice.
Coinbase investigated insider trading
Earlier this year, the platform Coinbase had been rumored to insider trading. Wishing to dispel all suspicion, the exchange then took the matter seriously by conducting an investigation. It emerged that an employee was indeed communicating confidential information to his brother and a friend. The employee in question was subsequently fired and Coinbase report their results to the court.
Brian Armstrong, CEO of Coinbase made a point of exposing the facts on his Twitter profile, stating that his company actively monitored any illegal activity :
1/ At Coinbase, we actively monitor for illegal activity and investigate any alleged misconduct. In April, we received information about possible frontrunning of assets shortly before being listed on Coinbase. We immediately launched an investigation into this.
— Brian Armstrong – barmstrong.eth (@brian_armstrong) July 21, 2022
Ishan Wahi, former product manager at Coinbase, as well as his brother Nikhil Wahi, were therefore arrested yesterday in Seattle. Their accomplice, Sameer Ramani, is also charged, but still free. All three are being prosecuted for using confidential Coinbase information to commit insider trading in the crypto-assets to be listed. They each risk up to one maximum of 20 years imprisonment.
To go further – Discover our tutorial and opinion on the Coinbase platform
Discover Coinbase
10€ offered for any deposit over 100€ with the link above 
A case highlighted by social networks
It was crypto influencer Cobie who noticed suspicious coincidences last April on portfolio activity. Indeed, an address had acquired certain tokens for several hundred thousand dollars, 24 hours before Coinbase announced that these would be potentially listed on the platform.
According to the investigation, the three individuals would have repeated their wrongdoing to 14 takeovers on 25 different assets. The events took place between June 2021 and April 2022, to generate unrealized capital gain estimated at $1.5 million.
Michael J. Driscoll, Deputy Director of Federal Bureau of Investigation (FBI) in New York, which also followed a similar case for OpenSea, spoke on the subject:
“While the allegations in this case relate to transactions made on a crypto exchange, rather than a more traditional financial market, they still constitute insider trading. […] Today’s action should demonstrate the FBI’s commitment to protecting the integrity of all financial markets, old and new. »
On May 16, Ishan Wahi was called to a meeting by Coinbase’s director of security operations as part of the investigation. The suspect then attempted to flee to India the day before the interview and was apprehended by law enforcement before boarding.
This survey shows that given the apparent anonymity of our ecosystem, often questioned by politicians, the activity of a person on the blockchain always leaves traces. Here, it is moreover the public nature of Ethereum (ETH), which allowed the community to reveal a crime which, perhaps, would have gone unnoticed in traditional finance.
Discover our Private Group
Content with high added value and quick to consume
Source: United States Department of Justice
Newsletter 
Get a crypto news recap every Sunday 
And that’s it.
What you need to know about affiliate links. This page presents assets, products or services relating to investments. Some links in this article are affiliated. This means that if you buy a product or register on a site from this article, our partner pays us a commission. This allows us to continue to offer you original and useful content. There is no impact on you and you can even get a bonus by using our links.
Investments in cryptocurrencies are risky. Cryptoast is not responsible for the quality of the products or services presented on this page and could not be held responsible, directly or indirectly, for any damage or loss caused following the use of a good or service highlighted in this article. Investments related to crypto-assets are risky in nature, readers should do their own research before taking any action and only invest within the limits of their financial capabilities. This article does not constitute investment advice.
I timidly discovered the world of blockchain at the end of 2018 during my quest for financial freedom. Initially invested moderately, it was only two years later that I took the gamble of betting everything on the movement that was taking shape then. I then dedicate 2021 to training myself better to acquire more knowledge and seriousness. As I often like to say: I still have a billion things to learn. And what I do know, I want to share with you.
Vincent Mayor
223 items
