On Tuesday, the brother of a former employee of Coinbase was sentenced to 10 months. This development comes after the person pleads guilty to charges of wire fraud conspiracy. According to US prosecutors, this was the first case ever in which insider trading of cryptocurrency was involved.
The person in question was Nikhil Wahi, who admitted to insider trading based on the confidential information acquired from Coinbase. According to US prosecutors, the former employee of Coinbase shared confidential information with Nikhil Wahi (brother) as well as their friend named Sameer.
Out of all these charged with insider trading, Ishan Wahi has still not pleaded guilty, while Sameer is still at large.
The sentence was announced by Loretta Preska, who is working as the US District Judge and was hearing this particular case.
This sentence comes at a time when the US regulators and prosecutors are stepping up their scrutiny of crypto firms and those who work there.
Just last month, Sam Bankman-Fried was also charged with charges of conspiracy and fraud. This is an indication that we will see more regulatory oversight of the crypto industry and a lot more cases like this.
For now, Bankman-Fried has not pleaded guilty to any of the charges. However, Gary Wang and Caroline Ellison, who were close associates of Mr. Bankman, have pleaded guilty. This means things could get ugly for Bankman-Fried as the people close to him have already turned sides.
As a result of this turbulent news, the sentiment surrounding crypto is negative. When we combine this with the drop in BTC prices during 2022, the overall picture is very bleak.
Recently, Coinbase has also announced a job cut in which it would let go of 950 employees. This means Coinbase is letting go around 20% of its total workplace.
As for the case of Nikhil Wahi, prosecutors had recommended a sentence between 10 to 16 months. On the other hand, his lawyer argued that Nikhil had already spent some time in prison. He also stated Nikhil's desire to repay his parents, who funded his college education.