Latest OpenSea News

If you ask for a general consensus in the digital assets industry, it’ll be that most financial laws and regulations don’t apply. At least, that’s what many mistakenly believe, and some are finding out the hard way that it simply isn’t true. On June 1, the U.S. Department of Justice announced that it is prosecuting a former employee of Ozone Networks, Inc (OpenSea) with wire fraud and money laundering in connection with a scheme to commit insider trading in NFTs. Who’s being charged, and what did they do? The former employee of Ozone Networks is named Nathaniel Chastain. According to the unsealed indictment, Chastain used confidential information about NFTs that would soon be featured on the homepage of OpenSea for personal financial gain. In other words, he front ran OpenSea customers. U.S. Attorney Damian Williams said, “NFTs may be new, but this type of criminal scheme is not…Today’s charges demonstrate the commitment of this office to stamping out insider trading—whether it occurs on the stock market or the blockchain.” FBI Assistant Director-in-Charge Michael J. Driscoll elaborated on how Chastain knew what NFTs would be listed on the homepage of OpenSea and how he purchased many of them in advance. He emphasized that the FBI would continue to aggressively pursue market manipulators. That’s quite a different set of statements to the ‘code is law’ mantra many in the industry live by. Old wine in new bottles Bitcoin’s inventor, Dr. Craig Wright, has been warning for years that technology must bend to the law and not vice versa. He has described in detail how he designed Bitcoin (BSV) to comply with existing regulations from the outset. He’s been smeared, mocked, and vilified simply for pointing out that existing financial laws apply to everything in the so-called digital assets industry and that eventually, governments would figure out how they apply and prosecute anyone who violates them. For years, this position was ridiculed and deemed outdated. Anarchists and misfits of all kinds dismissed the warnings of Dr. Wright and others, promoting falsehoods such as the anonymity of Bitcoin and other digital assets to make the case that the law did not apply to this new asset class. With the arrest of Nathaniel Chastain, we’re once again finding out who has a true understanding of how things work and how the industry will look a few years from now. As Dr. Wright often says, many of the schemes and scams in the industry are just old wine in new bottles, and when authorities figure out how they work, lots of people are going to be in a world of trouble. An industry replete with criminality While it’s not OpenSea’s fault that an employee went rogue and decided to put his own financial gain before any sense of ethics, this is a story that is repeated far too many times in the ‘digital assets’ industry. From exchange insiders at Coinbase dumping mass amounts of company stock at the market top to reports of unknown wallets loading up on tokens before they’re listed on major exchanges to rumors that Terraform Labs insiders moved millions through shell companies in the wake of the UST/LUNA collapse, the digital currency industry is jam-packed with criminals, fraudsters, deceivers, and unethical characters of all stripes and persuasions. It’s time for the public to wake up and realize that all the talk of liberating the masses from the clutches of the financial elites, banking the unbanked, and democratizing finance are just buzzwords used by smooth-talking swindlers and wolves in sheep’s clothing. None of it is real, none of it was ever necessary, and none of it will come to fruition. It’s all just a giant fee-generating machine for the unscrupulous characters who run the carnival. Whether or not Nathaniel Chastain goes down for his alleged crimes, a long list of others in the industry will follow in the years to come. CoinGeek has been and will be reporting on it every step of the way. Follow CoinGeek’s Crypto Crime Cartel series, which delves into the stream of groups—from BitMEX to Binance, Bitcoin.com, Blockstream, ShapeShift, Coinbase, Ripple, Ethereum, FTX and Tether—who have co-opted the digital asset revolution and turned the industry into a minefield for naïve (and even experienced) players in the market.

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