Former OpenSea employee Nate Chastain filed a motion to dismiss the charge against him regarding an alleged insider trading scheme, saying the US government’s allegations were wrong.
Meanwhile, there has been a growing case of executives from various cryptocurrency-based companies being accused of insider trading.
Chastain’s attorneys defy insider trading fees
According to court documents, Chastain’s legal team said NFTs were not classified as securities or commodities. Because insider trading has to do with using inside, non-public information to trade securities, such charges cannot be imposed on the former OpenSea employee.
In a filing statement it reads:
“Consequently, the government, having intertwined the accusation with the language of insider trading and making public statements announcing that this case sounds like insider trading, should not be allowed to proceed on Carpenter’s telematic fraud theory on the subject. ‘insider trading when he agrees that the relevant pieces of “digital artwork” are not titles “.
In addition, the lawyers called for the filing of the electronic fraud count against Chastain, arguing that the allegedly misappropriated confidential information cannot be constituted as “property”.
The latest development comes shortly after the Justice Department accused the former OpenSea product chief of a telematics fraud tally and a money laundering tally. Both charges carry a maximum prison sentence of 20 years each.
Meanwhile, allegations of insider trading against Chastain surfaced in September 2021. The former staff allegedly used secret wallets to buy NFT drops before they were listed on the home page, with profits totaling 19 ETH.
Amid the allegations, Chastain resigned from OpenSea, while the market giant NFT launched new policies in response to the incident.
Other cryptocurrency firm executives accused of insider trading
In addition to Nate Chastain, more employees of cryptocurrency companies have been criticized on allegations of insider trading.
As previously reported by Cryptopatata In August, former Coinbase product manager Ishan Wahi pleaded not guilty to insider trading after the DOJ indicted the former executive, his brother Nikhil Wahi and his partner Sameer Ramani for the crime.
In July, Axie Infinity co-founder and CEO Trung Nguyen also denied speculation about his involvement in insider trading. Tron founder Justin Sun dismissed similar allegations in early March.
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