NEW YORK, June 3 — US authorities have charged a former manager at a digital exchange platform with fraud and money laundering, in what they said was the first insider trading case involving non-fungible tokens, or NFTs.
Chastain, 31, went on to sell the NFTs for two to five times the initial price after they got star billing at the OpenSea website, the criminal case against him states. “NFTs might be new, but this type of criminal scheme is not,” US attorney Damian Williams said in a release. “Nathaniel Chastain betrayed OpenSea by using its confidential business information to make money for himself.” Chastain was arrested in New York on Wednesday on charges of wire fraud and money laundering that each carry a maximum penalty of 20 years in prison, prosecutors said.The arrest was touted by prosecutors as the first-ever insider trading bust involving digital assets.