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