It should be noted that the reason for the investigation was the tweets of a well-known representative of the blockchain community under the nickname Cobie, who has 716,000 followers on Twitter today. On April 12, 2022, he reported the discovery of an Etherium address whose owner was buying up hundreds of thousands of dollars worth of tokens about a day before they were listed on Coinbase and related news. Here’s that very tweet.

Note that news of a particular crypto-asset listing on major exchanges is usually good for the coin's price. Still, if it is new, it indicates development of the project. And in any case, such asset gets new trading volumes, which is also good for it.

That is, in this case, the address owner found out about certain assets beforehand, waited for the listing to be announced and got rid of them after the growth of the rate. This is insider trading. Hence, we can conclude that intelligence officials do read tweets within the cryptocurrency community.

New scandal surrounding Coinbase

According to Cointelegraph sources, Ishaan Vahi as product manager had information about adding trading pairs with new tokens on Coinbase between August 2021 and May 2022. Between June and April, he and his associates invested in the coins in advance to make a virtually guaranteed profit on the rise in the price of the assets once they were listed.

The trio of suspects are believed to have managed to pull off a similar scheme with at least 14 listings from different accounts and wallets. Law enforcement agencies have already arrested the Wahi brothers, while another suspect Samir Ramani remains at large for now. According to FBI spokesman Michael Driscoll, the actions of the trio can be seen as breaking the law. Here is his rejoinder.

Although the charges in the case relate to transactions on a crypto exchange rather than a traditional marketplace platform, the suspects’ actions could still be considered insider trading.

Here’s the relevant tweet by the agency’s representatives, which was made public about the insider trading.

The Securities and Exchange Commission (SEC) filed a separate lawsuit against the suspects and noted that their combined benefits exceeded the one million dollar mark. It is understood that this benefit was derived from at least nine separate cryptocurrencies. In total, the suspects traded 25 cryptocurrencies in the scheme. So there is a possibility that some of them did not make significant profits.

As a reminder, Coinbase has been implicated in similar scandals before. Its CEO Brian Armstrong does not deny that some employees may well have overstepped their authority. Here’s his rejoinder.

If an investigation reveals that any Coinbase employee has in any way aided or abetted criminal activity, they are immediately dismissed and their details referred to the appropriate authorities (possibly for prosecution).

Coinbase CEO Brian Armstrong

The prosecutor’s office also said that Coinbase’s director of security operations contacted Ishan on 11 May to arrange a meeting about listing new assets. Immediately thereafter, Ishan purchased a ticket and attempted to board a one-way flight to India before the scheduled meeting on May 16, but was arrested by law enforcement.

The Coinbase situation was commented on by Binance exchange chief Changpen Zhao. Here is his rejoinder from Twitter.

Cryptocurrencies or not, regulated industry or not, insider trading and frontrunning should be considered a criminal offence in any country. If you work in the industry, don’t do it. And even if you have only witnessed one of these cases, you may be in trouble later on. Let it be known as soon as possible.

The popular cryptocurrency platform Blockchain.com also has staffing problems – but of a different kind. The day before, its representatives announced a 25 percent staff reduction, which means that around 150 people could lose their jobs. The platform’s entire branch in Argentina will be closed, while expansion plans in other regions are halted. Around 44 per cent of the cuts will affect employees in Argentina, with another quarter of those laid off in the US and the rest in the UK.

The cuts themselves are due to serious financial problems at Blockchain.com, Decrypt reports. As a reminder, the platform incurred a $270 million loss from its investment in crypto fund Three Arrows Capital, which relatively recently declared bankruptcy. The main reason for its problems, however, was the dramatic drop in the crypto market and its risk management system.


It is important to note that many cryptocurrency companies have faced similar difficulties amid the collapse of the coin market. However, there are exceptions. For example, the Binance exchange earlier said it was ready to hire 2,000 professionals. Last night, Emin Gun Sirer, the founder and head of Ava Labs, who is focused on building and developing the Avalanche ecosystem, also announced the search for new employees.

Here’s his relevant recent tweet.


We think the story turned out to be quite funny. First of all, the funny thing is that the crooks did not disguise themselves in any way, i.e. they bought up exactly the coins they planned to pour in. Obviously, if other crypto-assets were purchased at the same time, it would be much harder to notice such a trend. So in the end, the Coinbase employee didn't take the transparency of the blockchain into account - and paid the price. Hopefully, in time, such cases will disappear.

For more interesting news, check out our millionaires’ cryptochat. There we discuss other important details about what’s going on in the coin market.