Regulators are fighting? CFTC calls out SEC over charges against Wahi, formerly of Coinbase

By meg0 | One Two Ten | 22 Jul 2022

July 21, 2022 --- earlier today, the SEC put out a press release announcing that they were charging Ishan Wahi and two others with insider trading. Wahi was a former Coinbase product manager, who helped coordinate public listing announcements relating to new coins that were going to be added to the platform.

During the 10-month period between June 2021 and April 2022, Wahi is accused of repeatedly tipping off his brother Nikhil Wahi, and his friend, Sameer Ramani with confidential about which new coins Coinbase would be adding to the platform before such information was public. As stated in the SEC's complaint, "Ahead of those announcements, which usually resulted in an increase in the assets’ prices, Nikhil Wahi and Ramani allegedly purchased at least 25 crypto assets, at least nine of which were securities, and then typically sold them shortly after the announcements for a profit. The long-running insider trading scheme generated illicit profits totaling more than $1.1 million."

Later the same day a Commissioner of the Commodity Futures Trading Commission (CFTC) issued a press release of her own, calling out the SEC for "regulation by enforcement." This is probably the most common complaint I've heard lately from within the crypto bubble about how the SEC has been approaching cryptocurrencies, but it's interesting to hear that complaint being voiced by a US regulatory group.

The CFTC Commissioner's statement is pretty scathing and definitely worth a read.

It's also worth noting that the SEC and CFTC are the two regulatory bodies that the Responsible Financial Innovation Act plans to lean on to create "a regulatory framework for digital assets." This bill was proposed in June by Senators Kirsten Gillibrand (D-NY) and Cynthia Lummis (R-WY).

Should we expect more infighting and turf wars in the near future for the SEC & CFTC?