Authorities of the United States have nabbed a Former OpenSea employee on allegations of insider trading. According to several reports, Nathaniel Chastain was arrested yesterday after confirmation of the allegations against him. Before he left the company, Chastain worked as one of the product designers at the NFT marketplace. However, this case will be the first ever to occur in the crypto market regarding NFTs.
The former OpenSea employee sold 45 NFTs for profit
According to the prosecuting party, the former OpenSea employee, during his time at the company traded and sold about 45 NFTs for profits on OpenSea. His modus operandi was to purchase the NFTs and put them on sale at a later date, raking in as many profits as possible. Investigations show that the former OpenSea employee would buy the artworks within seconds of listing on the platform and sell them as soon as there was profit for the taking.
What the authorities are arguing now is that Chastain had full access to which NFTs would get listed at every interval. This will give him an insight into which artworks to purchase which would yield maximum profits in the shortest time possible. One of the NFTs that were involved in the process was ‘Spectrum of Ramenfication’, one in which Chastain sold for over four times the amount that it was listed. The fishy aspect was that the NFT was only listed the night before, and it was sold immediately in the morning.
Chastain could face 20 years in jail
The Attorney of the United States, Damian Williams has also released a statement to that effect, reiterating his commitment to go after perpetrators of insider trading. Chastain has also been slammed with charges bordering on wire fraud and money laundering. If he is pronounced guilty, he could be facing up to 20 years in jail. In their statement, OpenSea mentioned that when they discovered what he was doing, they opened an investigation into the issue.
After unraveling the extent of the crime, they sacked Chastain at the time. After he was let go at OpenSea, Chastain started working on Oval, a project that he has been nurturing. Some weeks ago, the top executive at Coinbase, Brain Armstrong had to respond to charges bordering on insider trading. The criminals that carried out the act were said to be either known associates of the company or the staff of the company. Although there has not been any update regarding the issue in recent days, the company said it will review the way its items get listed on the platform.