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Analysts' Insights

Analysts' Insights

SCARE THEM & just SETTLE: the SEC crypto strategy?

1) A former product manager for Coinbase and his brother have agreed to settle U.S. Securities and Exchange Commission (SEC) charges related to insider trading of crypto asset securities.

2) Based on some academic studies, at least 10-25% of all token listings were front run by internal crypto exchange personal.

3) Nikhil Wahi pleaded guilty to one charge of wire fraud in September 2022 and was sentenced to ten months in prison, while on February 7 2023 Ishan Wahi pleaded guilty to two counts of conspiracy to commit wire fraud.

4) The SEC today announced that former Coinbase product manager Ishan Wahi and his brother, Nikhil Wahi, agreed to settle charges that they engaged in insider trading through a scheme to trade ahead of multiple announcements regarding at least 9 crypto asset securities.

5) Ishan Wahi helped to coordinate the platform’s public listing announcements that included what crypto assets would be made available for trading.

6) Wahi was accused of sharing confidential information with his brother, Nikhil, and a friend, Sameer Ramani, tipping them off at least fourteen times

7) In the criminal action, Ishan and Nikhil Wahi pled guilty to conspiracy to commit wire fraud. Ishan Wahi was sentenced to 24 months in prison and ordered to forfeit 10.97 ether and 9,440 Tether, and Nikhil was sentenced to 10 months in prison and ordered to forfeit $892,500.

8) Nikhil and Ishan agreed they would not deny the SEC's allegations. Neither received a penalty and the disgorgement order by the SEC was deemed covered by the related criminal proceedings.

9) In pleading guilty to the criminal charges, Ishan Wahi said he did not believe any of the relevant tokens were securities.

10) “The Wahi settlement involves no statement or admission that the crypto assets at issue are securities,” the spokesperson for Coinbase said. So does this mean that 'tokens' are not securities? Instead of giving a definitive legal answer by the court, the SEC has "settled"....

Will the SEC 'settle' with Ripple XRP next...??

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