According to a report from Cointelegraph, a federal judge has sentenced former OpenSea product manager Nathaniel Chastain to three months in prison for wire fraud and money laundering related to insider trading on the platform.
In an August 22nd announcement from the United States Department of Justice, U.S. Attorney Damian Williams said Chastain had been sentenced to three months in prison, three months of home confinement and three years of supervised release in addition to being ordered to pay a $50,000 fine and forfeit ill-gotten Ethereum from the non-fungible token (NFT) trades.
Inner City Press reported he would be required to surrender himself on November 2nd, with Chastain's lawyers planning to appeal the decision and request bail.
“Respect for the law and general deterrence militate for punishment,” reportedly said the judge at sentencing. “But Chastain is a first time offender. There are mitigating circumstances. He has a potentially promising future.”
Chastain, accused of misusing insider knowledge in his position at OpenSea to gain financially off the trading of NFTs, was convicted by a jury on May 3rd of wire fraud and money laundering. In his position as product manager, he had the power to choose which NFTs would be listed on the OpenSea platform. He bought 45 NFTs prior to them being listed and then resold them.
An August 22nd order from Judge Jesse Furman stated that the court would examine whether Chastain would be required to relinquish any ETH from the insider trading plot or the U.S. dollar equivalent. The sentencing likely marked the conclusion of the case following Chastain being charged and arrested by U.S. authorities in June of 2022.
In a separate case, former Coinbase product manager Ishan Wahi was sentenced to two years in prison in May for using privileged information at the exchange to gain monetarily from new token listings. His brother Nikhil and associate Sameer Ramani were also charged in the same case for their part in the scheme, with Nikhil pleading guilty in September 2022 and being sentenced to 10 months in prison. At the time of publication, Ramani was still at large.