In a recent tweet, the U.S. Securities and Exchange Commission (SEC) has announced that Ishan Wahi, a former product manager at Coinbase, and his brother Nikhil Wahi have settled insider trading charges.
Ishan Wahi, who used to work for Coinbase, has accused the Securities and Exchange Commission (SEC) of publicly disclosing information about the crypto assets available for trading on the platform. Ishan has been accused of repeatedly leaking confidential information to his brother and a friend, Sameer Ramani, regarding the timing and content of upcoming listings.
Nikhil Wahi and Ramani have been charged of using insider information to purchase at least 25 cryptocurrencies, nine of which were classified as securities by the SEC. The duo allegedly sold these cryptocurrencies shortly after the announcements, resulting in a profit.
The Wahi brothers have reached a settlement in which they have agreed to be permanently enjoined from violating securities laws. Additionally, they would be required to pay disgorgement of ill-gotten gains and prejudgment interest. In a recent development, it has been reported that the disgorgement and prejudgment interest would be considered fulfilled if the court sanctions the forfeiture of the assets belonging to the Wahi brothers in the ongoing criminal case.
The Securities and Exchange Commission (SEC) recently announced its decision to refrain from pursuing civil penalties against the Wahi brothers. This decision has been made in light of the prison sentences that have already been imposed on the individuals above.
The settlement has garnered attention from legal experts within the cryptocurrency industry. In a recent tweet, legal expert John Deaton weighed in on the SEC’s classification of “crypto-asset securities,” stating that any asset has the potential to be marketed and sold as an investment contract.
Any asset can be marketed, packaged, offered and sold as an investment contract. #BTC was, as were cute 🦫s and 🦫s are quite useful. 🥃 was offered/sold as an investment contract and it has great utility – consumption. “Crypto asset securities” is a pushing a false narrative. https://t.co/6Eam3aKj1c
— John E Deaton (@JohnEDeaton1) May 31, 2023
However, Forbes legal analyst Hailey Lennon agreed with the SEC’s enforcement strategy. She said the settlements were flawed because they suggested certain tokens were to be classified as securities without the SEC proving this.
