Former executive at OpenSea was charged with some allegations that got him arrested and authorities seeking for further processes
Recently a top former executive at OpenSea, a highly reputed and valued NFT Marketplace got arrested on Wednesday. It came to know that Head of Product at OpenSea Nate Chastain was charged with allegations of fraud and money laundering under the connection with a scheme that committed actions related to insider trading. As per Office of US Attorney in the Southern District of New York’s press release.
Earlier it was also reported when former OpenSea executive Nate Chastain was fired. He was accused for making front-running purchases of non fungible token collections that he knew were going to be featured on the OpenSea homepage prominently. It was reported that other NFT buyers have discovered his actions who reviewed and analyzed his transactions over the Ethereum blockchain.
Soon OpenSea fired Chastain after they came to determine the allegations were found legitimate, although Chastain has still continued to remain active in the NFT community, particularly on Twitter. NFT marketplace has outlined that it did not have any specific policies instead of prohibiting this such behavior ahead of time but has also established legality through new employee roles.
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Most recently, OpenSea was valued at about $13.3 billion by several institutional investors including Andreessen Horowitz, Coatue and Paradigm. The Department of Justice and Southern District of New York (SDNY) office of the US Attorney have started getting more active in violation of law involved in crypto crimes. But the NFT sector has avoided much of these actions that made the announcement come as a bit of shock especially for those who are in the crypto space.
US Attorney Damian Williams stated in a press release that NFTs might be new but such criminal schemes are not. As per the allegations of Nathaniel Chastain of betraying OpenSea while using and taking advantage of confidential business information in order to make capital for himself. Charges of him that implied today were according to the commitment of this office to stop such practices of insider trading. Then it’s not the matter where it is going, either in the stock market of the blockchain space.
There were many instances of front-running and insider trading in the crypto market, but since there were no such legal implications in the space, no one has received severe punishment like the traditional stock market has.
Source: https://www.thecoinrepublic.com/2022/06/02/why-was-the-former-executive-of-nft-marketplace-opensea-arrested/