Ex-OpenSea employee sentenced to 3 months for insider trading

An ex-employee of a crypto marketplace, OpenSea, was sentenced last week in the U.S. for money laundering and wire fraud, marking the first-ever insider-trading case involving digital assets.

Convicted in May with two charges that could lead to serving 40 years in prison in total, Nathanial Chastain is now facing a three-month home confinement on a three-year probation. He’s also ordered to pay a fine of US$50,000, relinquish 15.98 ETH (~US$26,000), and spend 200 hours on community service.

Read also: “OpenSea changes policies for NFT creator’s royalties upon resale”

Chastain was a product manager at one of the world’s biggest marketplaces, OpenSea, where he was accountable for selecting tokens to be featured on its website’s homepage, which usually came with a noticeable boost in price.

With the non-public information he had, Chastain bought 45 to-be-featured NFTs on 11 different occasions and sold them afterward in five transactions, earning more than $57,000.

As the first convicted case in which insider-trading of digital assets is involved, prosecuting attorney Damian Williams said in the hearing that the “sentence should serve as a warning to other corporate insiders that insider trading — in any marketplace — will not be tolerated.”