Former product manager of Coinbase Global Inc, Ishan Wahi on Tuesday, May 9, 2023 was sentenced by US prosecutors to two years in prison in the first insider trading case involving cryptocurrency. Reporting from Channel News Asia, Wednesday (10/5/2023), US District Judge Loretta Preska convicted Ishan Wahi, in Manhattan federal court after the defendant pleaded guilty in February to two counts of conspiracy to commit wire fraud.

Insider Trading or insider trading is a person or party who knows when an asset will be traded on the market. This information is confidential and will be informed when an asset will be listed on the market. Generally when a new asset is listed, its price will increase in the short term, this is what insider trading takes advantage of to make a profit.

This is one of several cryptocurrency-related cases filed by US prosecutors in New York, including one against FTX founder Sam Bankman-Fried, who has pleaded not guilty. Prosecutors said Wahi shared confidential information with his brother Nikhil and their friend Sameer Ramani about which digital assets would be listed on Coinbase, one of the world’s largest crypto exchanges.

The information allowed the three men to earn USD 1.5 million or the equivalent of IDR 22.1 billion (assuming an exchange rate of IDR 14,758 per US dollar) trading 55 digital assets prior to the announcement of the listing between June 2021 and April 2022, according to prosecutors.

Nikhil Wahi pleaded guilty in September 2022 to wire fraud conspiracy charges, and in January 2023 was sentenced to 10 months in prison. Ramani is still at large. During a hearing on Tuesday, Ishan Wahi expressed remorse for his actions and the effect they had on his friends and family, some of whom were in court.

“I made a big mistake that will follow me for the rest of my life,” said Wahi.

Wahi had asked in court papers for no longer sentence than his brother, citing other insider trading cases that resulted in little or no jail time.