Ex-Coinbase Employee Accused of Insider Trading Pleads Not Guilty

A former Coinbase employee at the heart of an insider trading case has pleaded not guilty. His lawyer claims the assets aren’t securities

article-image

Gary Gensler, Chair, US Securities and Exchange Commission | Blockworks exclusive art by Axel Rangel

share

key takeaways

  • The accused, along with two others, allegedly profited $1.1 million with inside knowledge of Coinbase token listings
  • His lawyer has reportedly argued the charges should be dropped, as insider trading cases only relate to securities or commodities

An insider trading case could confirm whether some cryptocurrencies listed by Coinbase are in fact securities.

Ishan Wahi, the former Coinbase product manager accused of insider trading, has pleaded not guilty to the Securities and Exchange Commission’s (SEC) charges of wire fraud.

Reuters reported on Wednesday that both he and his brother, Nikhil Wahi, made their “not guilty” pleas at an arraignment in a Manhattan court before District Judge Loretta Preska. 

They were both arrested in Seattle last month after the SEC accused Ishan of trading cryptoassets based on confidential information between June 2021 and April 2022.

The regulator alleged he tipped his brother and friend Sameer Ramani about upcoming announcements of new Coinbase listings, which have been found to often coincide with big rallies.

All three have been charged with netting $1.1 million in profits from the sale of at least 25 tokens in an insider trading scheme. 

Ishan is said to have bought a one-way plane ticket to India after a Coinbase security director called him for a meeting at the crypto exchange’s Seattle office. Ramani reportedly remains at large.  

Ishan’s lawyer, David Miller, has disputed the wire fraud charges. He reportedly believes they should be dropped as insider trading cases relate to securities or commodities — saying those laws wouldn’t be relevant in this case. 

However the SEC, in its statement, labeled at least nine of the cryptoassets traded by the charged individuals as securities, which Coinbase has denied.

Miller also suggested that the information shared by his client wasn’t confidential, saying Coinbase tested new tokens before publicly listing them. 

Judge Preska has ordered both the brothers to be released on a $1 million personal recognizance bond, according to Law360.

Blockworks didn’t receive replies to requests for comment from Coinbase or lawyers for Ishan and Nikhil by press time. It’s unclear whether Ramani has an attorney.


Don’t miss the next big story – join our free daily newsletter.

Tags

Upcoming Events

HYATT REGENCY SALT LAKE CITY

TUES, OCT. 8, 2024

Guided by the expertise of Blockworks Research Analysts team, this one day event will feature senior leaders, entrepreneurs, and developers from across the crypto industry. Attendees will have the opportunity to participate in an immersive experience to explore the latest trends, […]

Salt Lake City, UT

WED - FRI, OCTOBER 9 - 11, 2024

Pack your bags, anon — we’re heading west! Join us in the beautiful Salt Lake City for the third installment of Permissionless. Come for the alpha, stay for the fresh air. Permissionless III promises unforgettable panels, killer networking opportunities, and mountains […]

recent research

hivemapper.jpeg

Research

We believe crypto market participants overlook Hivemapper’s fundamental potential due to a poor understanding of both the niche map data market and Hivemapper’s positioning relative to incumbents. Hivemapper’s token model catalyzes both a cost and product advantage via unmatched map freshness and near real-time accuracy, which is its wedge into a market characterized by stale data and high data collection costs. Its current and potential future product suite may represent one of the strongest possibilities for PMF in crypto today.

article-image

Public mining companies have been acquiring sites, refreshing machine fleets and diversifying business models in preparation for the event

article-image

Exploit shows centralization can sometimes be an asset

article-image

The Fidelity Ethereum Fund, like other proposed ETH ETFs, seeks to stake a portion of its assets, according to the firm’s Wednesday registration statement

article-image

The DAO first voted on enabling SAFE transfers over a year ago

article-image

The final Bitcoin halving, where the mining reward becomes smaller than one satoshi, is expected to occur in 2140