Coinbase Awarded $470,000 in Insider Trading Case

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  • Coinbase has been awarded $470,000 by a judge over the insider trading case
  • Nikhil Wahi, who pleaded guilty in September, also faces 10 months in prison
  • The case marks the first of its kind in the U.S.

Nikhil Wahi, one of the Coinbase Three charged with insider trading, has been handed a 10-month prison sentence and ordered to pay $469,525.50 following his guilty plea 

in September last year. The court filing, signed on April 6 but made public on Monday, revealed that Wahi had reached a plea deal with the Department of Justice following his arrest earlier in 2022 over allegations that he profited from inside knowledge of his brother, Ishan, who was a Product Manager at Coinbase. Ishan himself pleaded guilty in February.

Third Gang Member Still at Large

The Wahi brothers and a third accomplice, Sameer Ramani, used Ishan’s knowledge of upcoming coin listings on Coinbase to buy up the coins prior to the announcements, making over a million dollars by selling them at profit. The brothers have now admitted their complicity in the scheme, while Ramani remains at large. Ishan will be sentenced later this year and will likely receive a tougher penalty given his heavier involvement in the operation.

The restitution payment marks the latest development in the repercussions of an insider-trading scheme that could have industry-wide ramifications, while it is also the first successful prosecution of insider traders who exploited cryptocurrency markets, according to the Justice Department.

Trio Face SEC Charges

The Securities and Exchange Commission has also sued the trio in a civil suit for violating the antifraud provisions of the securities laws, which they will almost certainly now settle. The fines apportioned to them, plus their legal fees, will see that the brothers, and Ramani if he is caught, will be wishing for just a fraction of that one million dollars back.