Former Coinbase Employee Sentenced

On May 9th, 2023, a federal judge in the United States District Court for the Southern District of New York sentenced Ishan Wahi, a former product manager at Coinbase Global, to 24 months in prison for insider trading. Wahi had used confidential information he obtained during his time working at Coinbase to profit off new listings of tokens, totaling up to $1.5 million.

The judge, Loretta Preska, sentenced Wahi to two years in prison and ordered him to surrender by June 21st at 2:00 PM ET to serve his sentence at the Fort Dix Federal Correctional Institution in New Jersey. After his time in prison, he will be subject to two years of supervised release for each count, running concurrently.

During the hearing, Judge Preska addressed Wahi and said, “You spoke very nicely, you said all the right things. I hope that you can make this up to your parents.” Wahi’s counsel argued that the judge should consider his immigration status in the United States, that this was a non-violent offense, and that he had “zero criminal history” prior to his arrest.

However, Judge Preska held Wahi responsible for his actions and stated that insider trading is a serious offense that undermines the integrity of the market. Wahi’s insider trading not only harmed Coinbase but also put investors’ interests at risk.

Wahi was not acting alone in his insider trading scheme. Along with his brother Nikhil Wahi and associate Sameer Ramani, Wahi allegedly used confidential information from Coinbase to profit off new listings of tokens, totaling more than $1 million. U.S. authorities arrested Ishan and Nikhil in July 2022 as they were attempting to flee the country to travel to India.

Wahi’s sentencing has come as a warning to those who use insider information to their advantage in the market. Insider trading is a violation of securities laws that undermines the integrity of the market and harms the interests of investors.

Coinbase, one of the world’s largest cryptocurrency exchanges, is dedicated to protecting its investors’ interests and ensuring the integrity of its platform. The company has implemented strict policies and procedures to prevent insider trading, including monitoring employee activity and imposing consequences for violations.

Wahi’s sentencing has also raised concerns about the potential for insider trading in the cryptocurrency market. Cryptocurrency markets are largely unregulated, making them vulnerable to manipulation and insider trading. As cryptocurrency continues to gain mainstream adoption, regulatory authorities will need to implement measures to prevent insider trading and ensure market integrity.

In conclusion, Wahi’s sentencing serves as a reminder that insider trading is a serious offense that will not be tolerated in any market. The integrity of the market is essential for investors’ trust and confidence, and regulatory authorities must take necessary measures to ensure market integrity. Coinbase, as one of the largest cryptocurrency exchanges in the world, will continue to prioritize the protection of its investors’ interests and maintain the integrity of its platform.

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OKX Sends $60M to Alameda Research

On May 9, crypto exchange OKX transferred approximately $60 million worth of digital assets to wallets associated with failed hedge fund Alameda Research. According to data from crypto analytics platform Arkham Intelligence, the funds were spread out among 16 separate transactions and included approximately 337.9 million Mask Network (MASK) tokens worth $1.3 million, as well as $57.77 million worth of the Tether (USDT) stablecoin.

Alameda Research currently holds over $284 million worth of assets in its crypto wallets, with its largest holdings being USDT, BitDAO (BIT), Ether (ETH), and Stargate Finance (STG).

It is believed that the funds sent by OKX may have been part of a recovery effort to pay back customers of its sister company FTX. On March 30, OKX announced that it planned to return approximately $157 million it held on behalf of FTX and Alameda, which it had frozen in November to safeguard them. FTX had filed a motion on March 30 to force OKX to release the funds to pay back creditors, which OKX said it “welcomed.”

After filing for bankruptcy and coming under new management, FTX and Alameda Research have been aggressively trying to recover funds from firms they previously sent crypto to. On March 23, FTX reached a settlement with hedge fund Modulo Capital, allowing it to recover $460 million previously invested in the fund. On May 4, FTX filed a motion to claw back $4 billion it allegedly lent to bankrupt crypto lending firm Genesis Global.

FTX Group and roughly 130 companies under its umbrella, including Alameda Research, filed for bankruptcy in November after the crypto exchange suffered a liquidity crisis. Alameda Research’s former CEO, Caroline Ellison, has been charged with fraud for allegedly colluding with former FTX CEO Sam Bankman-Fried to misappropriate FTX customer funds. She pleaded guilty to the charges on Dec. 22. However, Bankman-Fried has pleaded not guilty and has sought to dismiss some of the charges against him.

In summary, OKX sent $60 million worth of digital assets to Alameda Research as part of a recovery effort to pay back customers of FTX. Alameda Research currently holds over $284 million worth of assets, including USDT and ETH. FTX and Alameda Research have been actively recovering funds from firms they previously sent crypto to after filing for bankruptcy in November.

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Marathon Digital and Zero Two Partner for Abu Dhabi Bitcoin-Mining Facility

Marathon Digital Holdings and Zero Two have announced a partnership to create a large-scale immersion Bitcoin-mining facility in Abu Dhabi. The joint venture, called the Abu Dhabi Global Markets JV Entity, will be based in Mina Zayed and Masdar City in the United Arab Emirates, and will comprise two mining sites with a combined 250-megawatt capacity. Marathon and Zero Two plan to power the facilities with excess energy from Abu Dhabi’s grid, claiming it will increase its base load and sustainability.

According to Marathon Digital, crypto mining in the desert climate of Abu Dhabi, where the average annual temperature is roughly 28 degrees Celsius (82 degree Fahrenheit), was often “infeasible.” However, the company said it had helped develop a “custom-built immersion solution” to cool mining rigs at the proposed facilities, suggesting a liquid-cooling solution.

The two firms expect both Abu Dhabi facilities to be online by 2024 and produce a combined hash rate of roughly 7 EH/s. Ownership of the project will be split between Zero Two and Marathon Digital, with the two companies controlling 80% and 20%, respectively.

The move comes as executives from United States-based crypto exchange Coinbase visited the UAE to test the potential of the region as a “strategic hub” for its international operations. Coinbase CEO Brian Armstrong met with policymakers and spoke at the Dubai FinTech Summit.

The joint venture between Marathon Digital and Zero Two aims to take advantage of Abu Dhabi’s excess energy to power the mining facilities, with a view to increasing sustainability and base load. The use of liquid cooling solutions will help to overcome the challenges of the desert climate, where high temperatures make traditional air cooling methods infeasible.

Marathon Digital’s experience in developing a custom-built immersion solution for cooling mining rigs will be key to the success of the project. The two firms plan to have both facilities up and running by 2024, with a combined hash rate of roughly 7 EH/s.

Meanwhile, Coinbase is exploring the potential of the UAE as a strategic hub for its international operations. The visit by the company’s executives, including CEO Brian Armstrong, highlights the growing interest in the region as a destination for crypto-related businesses.

Overall, the partnership between Marathon Digital and Zero Two represents a significant step forward in the development of the crypto mining industry in Abu Dhabi, as the two companies look to capitalize on the region’s excess energy and overcome the challenges of the desert climate. With the backing of both firms, the joint venture is well-positioned to succeed and could pave the way for further expansion in the Middle East.

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Epic Games CEO Defends Metaverse

In a recent tweet, Epic Games CEO Tim Sweeney pushed back against a recent article from Business Insider that claimed the Metaverse was “dead.” The article, written by PR firm CEO Ed Zitron, argued that virtual worlds had been abandoned by the business world, citing Meta’s Horizon Worlds, Decentraland, and Yuga Labs’ Otherside as examples of metaverses that had failed to live up to their hype.

Sweeney, however, was quick to point out that there are currently 600 million users across virtual world platforms like Fortnite, Minecraft, Roblox, The Sandbox, and VR Chat. In his tweet, Sweeney sarcastically suggested that the Metaverse was dead and that it was time to organize an online wake for the 600 million monthly active users across these platforms to mourn its passing.

This isn’t the first time that Sweeney has spoken out in defense of the Metaverse. In April 2022, Epic Games announced a $2 billion funding round aimed at accelerating the company’s plans for the Metaverse. The investment included a $1 billion investment from Sony Group and KIRKBI, the holding company behind the LEGO Group.

Shortly after the funding round, Epic Games and LEGO Group announced a long-term partnership to build a “family-friendly” Metaverse. While neither company has revealed any concrete details about the collaboration, LEGO Group CEO Niels Christiansen told the Financial Times earlier this year that the company was looking to announce more details soon.

Sweeney’s defense of the Metaverse is understandable, given that Epic Games is heavily invested in the technology. As the creator of the Unreal Engine and Fortnite, two major players in the virtual world space, Epic Games is well-positioned to take advantage of the growing interest in the Metaverse.

It remains to be seen whether the Metaverse will live up to its hype, but with major players like Epic Games and LEGO Group investing billions of dollars in the technology, it’s clear that the concept is not going away anytime soon. As more and more people turn to virtual worlds for work, play, and socializing, it’s possible that the Metaverse will become an integral part of our daily lives.

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OKX Global Ad Campaign Targets Outdated Financial Systems

OKX, a crypto exchange based in Seychelles, has launched a global ad campaign that targets the “broken ways” of the centralized financial system. The campaign, which was produced in collaboration with OKX’s advertising agency, BBDO New York, takes a direct aim at Coinbase’s campaign launched on March 9 that argued for the update of the financial system.

In the 60-second video campaign launched on May 9, OKX argues that the system doesn’t need an update, it needs a rewrite. While the campaign doesn’t directly reference Coinbase, it does seem to take a subtle dig at the exchange with its tagline.

OKX takes Coinbase’s idea a step further by arguing that the decentralized nature of Web3 means consumers don’t even need to be involved with centralized players in the first place. “There are two camps of thoughts. One side suggests we update existing systems to create a better world. The other believes we need a system rewrite. Our new campaign is a nod to those who believe we need to re-write the system into Web3,” said Haider Rafique, chief marketing officer of OKX.

OKX’s campaign comes after Coinbase’s “It’s time to update the system” campaign, which argued that American financial institutions are an essential part of the traditional finance system but still rely on outdated technology to serve their customers. Coinbase proposed that crypto is the answer to this problem.

In contrast, OKX’s campaign argues that decentralized systems, such as Web3, remove the need for centralized players altogether. OKX’s global ad campaign is part of its effort to expand its crypto services to Australia, which the exchange sees as a key growth market.

As the crypto industry continues to grow, exchanges such as OKX and Coinbase are vying for market share and positioning themselves as leaders in the space. Both exchanges have shown a willingness to push the boundaries and promote the adoption of cryptocurrency and blockchain technology.

While Coinbase and OKX may have different approaches to how the financial system should be updated, both agree on the need for change. As the financial landscape evolves and traditional systems become outdated, the crypto industry is poised to play a major role in shaping the future of finance.

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