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Ishan Wahi, a former product manager at Coinbase Global Inc, pleaded not guilty on Wednesday to wire fraud charges in what prosecutors called the first insider trading case involving cryptocurrency.

Wahi, 32, was arrested last month in Seattle on charges he shared confidential information with his brother and their friend about forthcoming announcements of new digital assets that Coinbase – one of the world’s largest cryptocurrency exchanges – would allow users to trade.

Prosecutors said the brother and friend used Ethereum blockchain wallets to acquire the assets and traded at least 14 times before Coinbase’s announcements from June 2021 and April 2022, generating at least $1.5 million of illicit gains.

Wahi was released on $1 million bail after appearing in Seattle federal court on July 21. He was arraigned on Wednesday in Manhattan federal court before U.S. District Judge Loretta Preska.

The U.S. Securities and Exchange Commission has filed related civil charges against him.

Coinbase said it has shared with prosecutors its findings from an internal probe into the trading.

Copyright 2022 Thomson/Reuters