Ishan Wahi, the former product manager at Coinbase Global accused of insider trading, was on Tuesday sentenced to 24 months in prison.
As ZyCrypto previously reported, Wahi pleaded guilty in February to fraud charges for his role in using insider information he obtained during his time working at Coinbase to profit off upcoming token listings.
The sentence imposed by U.S. District Judge Loretta Preska in Manhattan was one year shorter than what prosecutors had asked for.
Profiting From Insider Trading
Ex-Coinbase manager Ishan Wahi will spend time behind bars at a Federal prison after pleading guilty to insider trading allegations.
Wahi and his co-conspirators — including his brother, Nikhil Wahi — allegedly used information he acquired from America’s biggest crypto exchange to profit off new crypto listings. The alleged scheme revolving around trading on Wahi’s confidential information netted the three men as much as $1.5 million.
Judge Loretta Preska ordered Wahi to surrender by June 21 at 2:00 PM ET to serve his term at the Fort Dix Federal Correctional Institution in New Jersey. After his time in jail, he will be subject to two years of supervised release for each count, running concurrently.
Wahi tried to flee the country after being questioned by Coinbase, the Department of Justice revealed. But he was arrested by U.S. authorities in July 2022 while attempting to board a flight to India.
After first pleading not guilty and trying to dismiss the charges against him, the Indian National pleaded guilty in February to two counts of conspiracy to commit wire fraud.
Wahi, his brother, and his friend Sameer Ramani were also slapped with civil charges by the U.S. Securities and Exchange Commission (SEC). Ramani remains at large at press time, while Nikhil was sentenced to 10 months in prison.
Second Insider Trading Case Involving Crypto
Notably, U.S. prosecutors had recommended a three-year term for Wahi to dissuade other crypto insiders from misusing confidential information.
“You spoke very nicely, you said all the right things,” Preska said, while sentencing Wahi to two years in prison. “I hope that you can make this up to your parents.”
Wahi’s imprisonment marks the second criminal insider trading case involving digital assets that the Department of Justice has pursued.
The sentencing came less than a week after the ex-head of product at non-fungible token marketplace OpenSea, Nathaniel Chastain, was convicted of fraud and money laundering for using inside knowledge of which assets would be featured on the platform’s homepage to accrue illegal profits. According to the DOJ, this was the first-ever insider trading scheme involving crypto.
Chastain will be sentenced at a later date, but he faces a maximum of 40 years in prison.