The FBI foils crypto insider trading

By Scoop
July 25, 2022 · less than 3 min read

It’s a landmark case for crypto – and it all started with a tweet.  

Tweeting’s cheating

If someone had said ten years ago that the FBI would be using a tweet from a crypto influencer to finish off a seven-figure insider trading case, the response would probably be: Put down that beer. And while in 2022 this statement doesn’t feel like a different language, it’s still pretty ground-breaking.

Let’s roll it back a little. It all started with Cobie, a crypto Twitter user who spotted something out of the ordinary in the marketplace. He tweeted, “Found an ETH address that bought hundreds of thousands of dollars of tokens exclusively featured in the Coinbase Asset Listing post about 24 hours before it was published, rofl.” And from there, things exploded.

Why, Wahi?

After plenty of digging, it’s now come to light that The US Attorney’s Office for the Southern District of New York is bringing an indictment against a former Coinbase employee. According to the FBI, Ishan Wahi gave a tip-off to his brother and a friend on which assets were set to list on Coinbase. The result? $1.5 million in “realized and unrealized gains”.

Back in May, with the investigation in full swing, Wahi was called to attend an in-person meeting with Coinbase to talk things through. So, what did he do? Booked a one-way ticket to New Delhi, of course. Because that’s exactly what an innocent person would do. Unfortunately for Wahi, law enforcement were one step ahead, and he never made it into the air.

In this landmark case, there are lessons to be learned. It’s called a public blockchain for a reason. You wouldn’t rob a house in the middle of the day, while the occupant was working from home, now would you? And if you’re on crypto Twitter, maybe be a little careful about what you’re tweeting. The FBI is always watching.

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