A former Coinbase executive is among 3 charged in the first-ever crypto insider trading scheme

• Former Coinbase exec Ishai Wahi and two others were charged in the first-ever crypto insider trading scheme.
• The Justice Department alleged that Wahi tipped off his brother and friend on at least 25 crypto assets before they were listed on Coinbase.

A former Coinbase product manager and two others were charged in the first-ever crypto insider trading scheme, according to the Justice Department.

The US Attorney's Office in Manhattan alleged that the former Coinbase employee tipped off his brother and a friend on assets before they were going to be listed on Coinbase, which isn't implicated in any wrongdoing.

Ishan Wahi, the former Coinbase executive, as well as Nikhil Wahi and Sameer Ramani now face charges of wire fraud and insider trading. The Securities and Exchange Commission also filed a separate insider trading complaint against them.

The Wahi brothers were arrested Thursday, though Ramani had yet to be taken into custody. Attorneys for Ishan Wahi told Insider that the allegations against him have no merit. "Ishan Wahi is innocent of all wrongdoing and intends to defend himself vigorously against these charges and in the SEC action."

An attorney for Nikhil Wahi didn't respond when contacted by other news outlets.

US Attorney Damian Williams said in a statement that this is the first-ever insider trading case involving cryptocurrency markets, adding that the first-ever case of NFT insider trading happened just a month ago.

"Our message with these charges is clear: fraud is fraud is fraud, whether it occurs on the blockchain or on Wall Street," he said.

The Justice Department alleged Ishan Wahi tipped off his brother and Ramani at least 14 times on asset listings before they appeared publicly, allowing them to make at least $1.5 million in total on at least 25 crypto assets due to insider information.

The trio began to raise suspicion in April after Ramani purchased large quantities of six crypto assets before they were going to be listed on Coinbase, attracting the attention of a Twitter user within the online crypto community and pushing Coinbase to launch an investigation.

When Coinbase contacted Wahi in May to talk about the incident, he allegedly purchased a one-way ticket to India and notified his brother and Ramani of his attempt to depart the country. He was later stopped by law enforcement before he could board the plane.