In New York last week, the trial began of a former OpenSea employee who was indicted for wire fraud and money laundering in what is being seen as the first case of insider trading related to NFTs. He has been convicted of wire fraud and money laundering, both of which carry a maximum sentence of twenty years in prison. His sentencing is pending for 22 August.
To sum up what happened, OpenSea is the leading NFT marketplace (and completely dominated the sector at the time of the alleged crimes, June to September 2021), and often featured NFT collections of its choosing on its front page, which led to prices on those collections going up.
Nathaniel Chastain knew in advance which collections would be featured, and is accused of buying items from those collections in advance and selling them at a profit when being featured as their prices rose.
He did this using multiple anonymous wallets, and in contradiction of his contract, which prohibited such behavior.
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