- A former OpenSea executive has been sentenced to three months in prison for insider trading.
- The executive, Nathaniel Chastain, reportedly made over $50,000 in 2021 from his NFT insider trading scheme.
- Chastain pled not guilty last year, claiming that no one told him he couldn’t use the insider information.
A former OpenSea executive has been sentenced to three months in prison for perpetrating the first-ever insider trading scheme involving NFTs. Nathaniel Chastain, who worked as the Head of Product for the NFT marketplace, was found guilty of fraud and money laundering by a federal grand jury earlier this year. The former executive was convicted less than two weeks after his trial began in April this year.
3 Years Supervised Release For Ex-OpenSea Executive After Jail
According to a press release by the U.S. Attorney’s Office for the Southern District of New York, Nathaniel Chastain’s three-month-long prison term will be followed by another three months of home confinement. The former OpenSea executive will then face three years of supervised release.
Today’s sentence should serve as a warning to other corporate insiders that insider trading – in any marketplace – will not be tolerated.”
Damian Williams, U.S. Attorney SDNY
Federal prosecutors sought a two-year sentence for Chastain, citing a similar insider trading case involving a Coinbase manager who was sentenced earlier this year. However, the judge overseeing the ex-OpenSea executive’s case gave a lenient sentence, stating that he was a first-time offender and the proceeds from his NFT insider trading were considerably less than the Coinbase case.
Chastain was indicted by federal prosecutors in June last year. He was accused of abusing his position at OpenSea to buy NFTs that were set to be featured on the marketplace’s homepage. The former executive made more than $50,000 between June 2021 and September 2021 through his insider trading scheme.
Chastain reportedly used multiple wallets to route his funds and cover his tracks. After the former OpenSea executive was formally charged, his lawyers entered a not-guilty plea and later argued that no one told him that he couldn’t use or share the insider information in question.