- The director bought 45 NFTs in June-September 2021 with various anonymous wallets prior to the sale.
- He then sold them for over $50,000.
A federal judge sentenced former OpenSea product manager Nathaniel Chastain to prison for insider trading on the non-fungible token [NFT] platform, announced the United States Department of Justice on August 22.
U.S. Attorney Damian Williams said the court sentenced Chastain to three months in prison, three months of house arrest and three years of supervised release. The court also fined him $50,000 and ordered him to surrender ill-gotten Ethereum [ETH] of NFT sales.
Chastain was accused of insider trading during his stint with OpenSea. As product manager, he had the power to select the NFTs to be listed on the OpenSea platform. In June-September 2021, he purchased 45 NFTs using various anonymous wallets before adding these NFTs on the selling platform. He then sold them for over $50,000.
The US authorities charged and arrested Chastain in June 2022. A jury found him guilty of bank fraud and money laundering in May 2023. The final court order will most likely bring the case to an end.
The judge added that while the crime amounted to harsher sentences, Chastain’s sentence is lenient because he has not earned extraordinary income from the sale.
US Attorney Damian Williams said:
“Nathanial Chastain was brought to court today for breaching the trust placed in him by his employer by using OpenSea’s confidential information for his own gain. Today’s ruling should serve as a warning to other company insiders that insider trading – in any market – will not be tolerated.”
Is the NFT winter creeping into the third quarter?
The NFT market has been facing a downturn for several months now. It seems that this winter has nowhere to go.
According to a report Due to the Web3 development platform Alchemy, the trading volume of NFT decreased by 41% in the second quarter of 2023.
Another report according to DappRadar, July was one of the lowest NFT sales in 2023. NFT trading volume fell 29% to $632 million in July compared to May. The number of NFT sales in July also fell 23% to 3.7 million over the same period.
Meanwhile, the bottom prices of top collections such as Bored Ape Yacht Club have fallen [BAYC] and Azuki plummeted to its two-year low.
Source: DappRadar