The defense team for the former head of product of Opensea explained why they don’t think their client is guilty.
Nate Chastain, a former employee of OpenSea, submitted a motion to dismiss the indictment against him for an alleged insider trading conspiracy, claiming that the allegations made by the US government were false.
Executives of numerous cryptocurrency-based companies have been accused of insider trading in an increasing number of cases in the meantime.
Insider Trading Charges are Disputed by Chastain’s Attorneys
Chastain’s legal team contended that NFTs were not categorized as securities or commodities, according to court filings. Such accusations cannot be brought against the former employee of OpenSea because insider trading involves exploiting confidential, proprietary information to trade stocks.
According to a filing statement,
“Accordingly, the government, having laced the Indictment with insider trading language and having made public statements announcing this case as sounding in insider trading, should not be permitted to proceed on a Carpenter wire fraud theory of insider trading when it agrees that the relevant pieces of “digital artwork” are not securities.”
Additionally, the attorneys demanded that the wire fraud charge against Chastain be dropped because the allegedly plundered private information cannot be considered “property.”
The most recent development happened not long after the Department of Justice filed charges of wire fraud and money laundering against the former head of product at OpenSea. The maximum prison term for each of the counts is 20 years.
In the meanwhile, in September 2021, Chastain was accused of insider trading. The former employee is accused of using covert wallets to buy NFT drops before they were made public, earning 19 ETH as a result.
Chastain left OpenSea amid the claims, and the dominant NFT marketplace drew out new guidelines in reaction to the incident.
More Crypto Company Executives Have Been Charged with Insider Trading
Other than Nate Chastain, several cryptocurrency company employees have come under fire for allegedly engaging in insider trading.
Ishan Wahi, a former executive who was indicted by the DOJ for insider trading together with his brother Nikhil Wahi and business partner Sameer Ramani, entered a not-guilty plea in August.
Trung Nguyen, the co-founder, and CEO of Axie Infinity, refuted rumors that he had engaged in insider trading in July. Justin Sun, the founder of Tron, denied comparable claims back in March.