{"id":22445,"date":"2022-06-03T14:28:12","date_gmt":"2022-06-03T14:28:12","guid":{"rendered":"https:\/\/www.pantheregroup.com\/2022\/06\/03\/doj-charges-former-nft-marketplace-employee-for-insider-trading-scheme\/"},"modified":"2022-06-03T14:28:12","modified_gmt":"2022-06-03T14:28:12","slug":"doj-charges-former-nft-marketplace-employee-for-insider-trading-scheme","status":"publish","type":"post","link":"https:\/\/www.pantheregroup.com\/2022\/06\/03\/doj-charges-former-nft-marketplace-employee-for-insider-trading-scheme\/","title":{"rendered":"DoJ Charges Former NFT Marketplace Employee For Insider Trading Scheme"},"content":{"rendered":"<div style=\"text-align:center\"><\/div><p> \n<\/p>\n<div id=\"ctl00_CPI_dvBody\">\n<p> A former employee of an NFT marketplace OpenSea was charged with one count of wire fraud and one count of money laundering in connection with a scheme to commit insider trading in Non-Fungible Tokens, or NFTs, according to a statement by the U.S. Department of Justice (DoJ). This is the first case of its type involving insider trading in digital assets.<\/p>\n<p>31-year old Nathaniel Chastain was charged of using and trading on confidential inside <span class=\"landLinks\">business<\/span> information about NFTs that were going to be featured on OpenSea&#8217;s homepage for his personal financial gain. Chastain was arrested on Wednesday in New York and was presented in the United States District Court for the Southern District of New York.<\/p>\n<p>U.S. Attorney Damian Williams said, &#8220;Today&#8217;s charges demonstrate the commitment of this Office to stamping out insider trading &#8211; whether it occurs on the stock market or the blockchain.&#8221;<\/p>\n<p>OpenSea is the largest online marketplace for the purchase and sale of NFTs. Chastain is alleged to have launched an age-old scheme to commit insider trading by using his knowledge of confidential information to purchase dozens of NFTs in advance of them being featured on OpenSea&#8217;s homepage.<\/p>\n<p>Chastain, as product manager, was responsible for selecting NFTs to be featured on OpenSea&#8217;s homepage. He exploited his confidential insider knowledge for personal gain in violation of the duties of trust and confidence he owed to his employer.<\/p>\n<p>After an NFT was featured on OpenSea&#8217;s homepage, the price buyers were willing to pay for that NFT, and for other NFTs made by the same NFT creator, typically increased substantially.<\/p>\n<p>According to the DoJ, Chastain used the information to secretly purchase dozens of NFTs shortly before they were featured. He then sold them at profits of two- to five-times his initial purchase price. <\/p>\n<p>Meanwhile, Chastain conducted these purchases and sales using anonymous digital currency wallets and anonymous accounts on OpenSea To conceal the fraud.<\/p>\n<p>The charges of wire fraud and money laundering each carry a maximum sentence of 20 years in prison. The charges are merely accusations, and the defendant is presumed innocent unless and until proven guilty.<\/p>\n<p>This case is being handled by the Office&#8217;s Securities and Commodities Fraud Task Force, with assistance from the Federal Bureau of Investigation (FBI) and the National Cryptocurrency Enforcement Team. <\/p>\n<\/p>\n<p>Business News<\/p>\n<\/div>\n<p><script type=\"text\/javascript\">\n        window.fbAsyncInit = function () {\n            FB.init({\n                status: true,\n                cookie: true,\n                xfbml: true\n            });\n        };\n        (function (d) {\n            var js, id = 'facebook-jssdk'; if (d.getElementById(id)) { return; }\n            js = d.createElement('script'); js.id = id; js.async = true;\n            js.src = \"https:\/\/connect.facebook.net\/en_US\/all.js\";\n            d.getElementsByTagName('head')[0].appendChild(js);\n        }(document));\n    <\/script><br \/>\n<br \/>\n<br \/>DoJ Charges Former NFT Marketplace Employee For Insider Trading Scheme<\/a><br \/>\n<br \/>2022-06-03 14:28:12<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>A former employee of an NFT marketplace OpenSea was charged with one count of wire fraud and one count of money laundering in connection with a scheme to commit insider&#8230;<\/p>\n","protected":false},"author":2,"featured_media":22446,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"fifu_image_url":"https:\/\/images.unsplash.com\/photo-1563089145-599997674d42?ixid=MXwxMjA3fDB8MHxwaG90by1wYWdlfHx8fGVufDB8fHw=&ixlib=rb-1.2.1&auto=format&fit=crop&w=1950&q=80","fifu_image_alt":"","footnotes":""},"categories":[32],"tags":[],"class_list":["post-22445","post","type-post","status-publish","format-standard","has-post-thumbnail","category-technology"],"_links":{"self":[{"href":"https:\/\/www.pantheregroup.com\/api\/wp\/v2\/posts\/22445","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.pantheregroup.com\/api\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.pantheregroup.com\/api\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.pantheregroup.com\/api\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.pantheregroup.com\/api\/wp\/v2\/comments?post=22445"}],"version-history":[{"count":0,"href":"https:\/\/www.pantheregroup.com\/api\/wp\/v2\/posts\/22445\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.pantheregroup.com\/api\/wp\/v2\/media\/22446"}],"wp:attachment":[{"href":"https:\/\/www.pantheregroup.com\/api\/wp\/v2\/media?parent=22445"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.pantheregroup.com\/api\/wp\/v2\/categories?post=22445"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.pantheregroup.com\/api\/wp\/v2\/tags?post=22445"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}