Insider trading has always been frowned upon, no matter in which financial market it has emerged. Insider trading refers to people who are part of a financial platform and are taking advantage of data or information that is not primarily made available to the general public.
According to a recent report, the CEO of Coinbase, Brian Armstrong, has come out on Twitter to express his thoughts on the recent insider trading reporting on the Coinbase platform by a former employee.
Mr. Armstrong has communicated the whole thing with law enforcement agencies and has brought the matter to life about this so-called insider tipping scheme.
According to the records that law enforcement agencies were able to gather, the former product manager at Coinbase, Ishan Wahi, did indeed tip his brother and his friend about the upcoming public listings which were to be featured on the platform in the latest announcements which were to be made. This data included information about the crypto assets which were being developed at the moment and would momentarily be made available on the platform for active trading.
Crypto Exchanges Usually Keep this Information Confidential
It goes without saying that whatever exchange it is, it needs to keep this kind of information completely confidential because once the air is filled with the news of a new crypto token being listed on the exchange, its market value, as well as the price, is likely to increase.
Armstrong further clarified to the law enforcement agencies that as soon as this suspected act was reported to the higher authorities, an investigation was launched into this insider tipping scheme.
Three suspects were identified during the investigation, and all the information relevant to those was already made available to the law enforcement agencies.
Further down the line, the news of these people involved in this insider tipping scheme is also allegedly convicted of buying 25 crypto assets when they received the news and then selling them at a profit on a later date, thus playing the market and the exchange in unfair trade.