An ex-employee of the leading non-fungible tokens (NFT) marketplace has been charged with wire fraud and money-laundering offences in a sign that US law enforcement will no longer turn a blind eye to the crypto economy.
On Wednesday he was arrested by the FBI in New York and charged, in a case that could prove concerning for others in crypto who assumed that practices banned in regulated markets were fair game in the wild west sector.
In May, an apparent insider trading scheme was uncovered on a leading crypto exchange: a user who has not been identified would build up large positions in small cryptocurrencies shortly before they were listed on major exchanges, and then sell them for a profit in the resulting surge of interest. A Wall Street Journal report concluded that one such trade netted a profit of $140,000 on a $360,000 investment over less than a week.
Adding to the regulatory pressure, on Thursday the Commodity Futures Trading Commission sued Gemini, a New York-based crypto exchange founded by the Winklevoss twins, alleging the company misled regulators about the possibility of bitcoin price manipulation in a successful effort to convince the agency to allow the creation of a bitcoin futures contract.
