Ishan Wahi pleaded guilty to two charges of conspiracy to commit wire fraud.
Ishan Wahi, a former Coinbase product manager, pleaded guilty Tuesday to charges stemming from an alleged $1.1 million insider trading scheme.
Prosecutors in the Southern District of New York charged Wahi with two counts of conspiracy to commit wire fraud. In August, Wahi pleaded not guilty to wire fraud charges.
The former exchange employee was accused of disclosing information about upcoming token listings to his brother Nikhil and their mutual friend Sameer Ramani. In September, Wahi’s brother pleaded guilty to one count of conspiracy to commit wire fraud and was sentenced to ten months in prison.
According to federal prosecutors, this is the first insider trading case involving cryptocurrencies. Last July, three individuals were charged with participating in an insider trading scheme.
Wahi is currently facing additional Securities and Exchange Commission charges that could set a precedent for the cryptocurrency industry. When the SEC charged Wahi in July, it claimed that at least nine of the twenty-five tokens involved in the case were securities.
According to a recent court filing, Wahi’s attorneys filed a motion to dismiss the case yesterday, arguing that tokens traded on the secondary market do not constitute securities.
“In addition to holding Ishan and Nikhil Wahi liable for actions nobody could have anticipated would violate the securities laws […] it would establish sweeping SEC jurisdiction over an industry without any input from Congress,” the document states. “There is also no need to stretch securities laws into the digital asset space”