The Securities and Exchange Commission (SEC) has announced that Ishan Wahi, a former product manager at a cryptocurrency company, and his brother, Nikhil Wahi, have reached a settlement on insider trading charges.
In a Tuesday press release, SEC enforcement director Gurbir Grewal said: “While the technologies at issue in this case may be new, the conduct is not. We allege that Ishan and Nikhil Wahi, respectively, tipped and traded securities based on material nonpublic information, and that’s insider trading, pure and simple. The federal securities laws do not exempt crypto asset securities from the prohibition against insider trading, nor does the SEC.”
The case is the first ever involving a major financial institution. Last year, investigators uncovered evidence leading to the arrest of the Wahi brothers. Ishan and Nikhil both pled guilty to criminal offenses, with Ishan receiving a 24-month sentence and Nikhil receiving a maximum 10-month sentence. Sameer Ramani, the third suspect in the case, remains at large.
The crypto industry was eager to see how the case would shape the future of the industry. Lawyers for Wahi argued that the SEC had no standing in the case, as Coinbase’s assets are not securities.
The case is brought up during a very busy period for crypto enforcement by the SEC. Last year, the agency brought a total of 30 cryptocurrency-related enforcement actions, a 50 percent increase from 2021, and has already brought 13 in the first months of this year, putting it on pace for a 25 percent increase.
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