Former Coinbase product manager Ishan Wahi is close to reaching a settlement with securities regulators after pleading guilty to charges in the first-ever insider trading case involving crypto assets.
Last year, the U.S. Securities and Exchange Commission (SEC) sued Ishan, his brother Nikhil and their friend Sameer Ramani for allegedly trading crypto assets using top-secret information about which tokens are scheduled to be listed on Coinbase.
The Wahi brothers both pleaded guilty to criminal charges arising from the scheme that brought at least $1.1 million in illicit profits, but they also sought the dismissal of the SEC’s civil case in February. The siblings argue that the regulator is using “brute force” to exercise regulatory jurisdiction over the crypto industry.
A court document filed on Monday shows that the SEC has reached an “agreement in principle” with Ishan to resolve the claims against him. The regulator says it is also engaged in “good faith discussions” with Nikhil.
The SEC and the Wahi brothers also jointly ask Judge Tana Lin for an extension of the deadlines for filing the opposition to the motion to dismiss and the subsequent reply. They say it may take weeks to review the recommended settlement that will be submitted to the court for approval.
“To allow time for: 1) the SEC and Ishan Wahi to finalize the terms of a settlement; 2) the SEC and Nikhil Wahi to move forward on settlement discussions; and 3) for the SEC’s Commissioners to review proposed settlements, the parties jointly request that the deadline for the SEC’s Opposition be moved to June 15, 2023. The Wahis’ Reply would be due July 15, 2023.”
Pro-crypto lawyer John Deaton says Ishan’s deal with the SEC may involve testifying that the tokens listed on Coinbase are securities, which the regulator may use to sue the crypto exchange.
“Go back to when this case was filed by the SEC. I tweeted out that the SEC would flip Wahi and get him to testify against Coinbase. He will admit the tokens are securities in a deal and Gensler will use these self-serving admissions to justify going after Coinbase. Easy to see.
Maybe this guy gives testimony to hurt Coinbase – not that it would [be] true – or should be believed. Gensler isn’t going to let the law or the truth get in his way.”Don't Miss a Beat – Subscribe to get crypto email alerts delivered directly to your inbox
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