Ex-OpenSea Executive Lands in Prison for NFT Insider Trading

Nathaniel Chastain, a former product manager at OpenSea, will serve a three-month jail term for insider trading.

Man in open sea prison, NTF police kitty is guarding the gates.
Created by Kornelija Poderskytė from DailyCoin
  • An ex-OpenSea product manager has been sentenced to prison.
  • The former employee has been ordered to surrender himself.
  • The defendant has further been ordered to pay fines, among other directions.

Former OpenSea product manager Nathaniel Chastain has been sentenced to three months imprisonment for insider trading on the NFT platform. The announcement was made by the United States Attorney for the Southern District of New York in a press release dated August 22.

In May 2023, Chastain was convicted of money laundering and wire fraud charges, with the prosecution arguing that he violated OpenSea’s confidentiality agreement and used insider knowledge to make profitable trades worth about $50,000.

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As the former product manager at OpenSea, one of Chastain’s responsibilities included selecting which NFT collections would be featured on the platform.

Calls For Surrender

A U.S. District Judge sentenced the former product manager in absentia, ordering that he surrender himself to the authorities by November 2.

Nathanial Chastain faced justice today for violating the trust that his employer placed in him by using OpenSea’s confidential information for his own profit.  Today’s sentence should serve as a warning to other corporate insiders that insider trading – in any marketplace – will not be tolerated,” said U.S. Attorney Damian Williams.

Alongside a three-month jail term, Chastain was also sentenced to three months of home confinement, a further three years of supervised release, a $50,000 fine, and forfeiture of all Ethereum earned from the illicit trades.  

Will an Appeal Go Through?

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Chastain’s lawyers have stated their intent to appeal the sentence at a later date. During the trial, the lawyers argued that their client’s employer never treated knowledge of what NFTs would be displayed on OpenSea’s homepage as confidential information.

The appeal will be an uphill task, given that prosecutors wanted Chastain jailed for 21 to 27 months, comparing his case to former Coinbase product manager Ishan Wahi, who was sentenced to 2 years in prison for insider trading.

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This article is for information purposes only and should not be considered trading or investment advice. Nothing herein shall be construed as financial, legal, or tax advice. Trading forex, cryptocurrencies, and CFDs pose a considerable risk of loss.

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Brian Danga

Brian Danga, a Kenyan crypto reporter, is dedicated to delivering breaking news and updates from the cryptocurrency world. With a background as a Web3 writer and project manager, he recognizes the importance of unbiased reporting. Holding an LLB degree from the University of Nairobi, Brian's analytical skills contribute to his accurate news reporting. His personal interests include cooking, watching documentaries, reading, and engaging in intellectual discussions.