Key Points:
- The former Coinbase Product Manager and his attorney have asked to be dismissed from insider trading in July 2022.
- The argument from the attorneys is that the allegation is false because these tokens are not securities, and they are sold in the secondary market.
- Former Coinbase product manager Ishan Wahi and his brother were charged with insider trading by the SEC and raised $1 million.
Lawyers for former Coinbase product manager Ishan Wahi and his brother Nikhil Wahi asked the judge to dismiss the petition regarding the insider trading case, claiming that the U.S. Securities and Exchange Commission (SEC), according to The Block.
Lawyers for Ishan Wahi and Nikhil Wahi argued that the U.S. Securities and Exchange Commission (SEC) said the nine digital assets involved in the case were “wrong” to say they were securities and tokens. The associated token is a utility token needed to create its network and is sold on the secondary market, not securities.
“None of the tokens were like stock – something that sits as an investment with no practical utility. Rather, the very object of each token was to facilitate activity on the underlying platforms and, in so doing, enable each network to develop and grow,”
The lawyers said.
In the event that the judge denies the dismissal request, the case will continue unless an amicable resolution is reached.
Previously, former Coinbase manager Ishan Wahi was arrested last July for insider trading of cryptocurrency in the United States. The agency alleges Ishan Wahi secretly informed you and his brother, Nikhil Wahi, which tokens would be listed for trading on Coinbase.
His brother, Nikhil Wahi, pleaded guilty to insider trading in September of that year and was sentenced to 10 months in prison in January of this year. According to the DOJ, the defendant made $1.5 million through a scheme in which Ishan Wahi leaked a list of at least 14 different tokens, but the SEC estimates the figure to be closer to $1.1 million.
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