By Matthew Russell Lee, Patreon Maxwell Book
SDNY COURTHOUSE, Jan 21 – Already there have been several civil Non-Fungible Token cases in the U.S. District Court for the Southern District of New York.
On June 1, 2022 a criminal case was unsealed, charging NATHANIEL CHASTAIN, a former product manager at Ozone Networks, Inc. d/b/a OpenSea (“OpenSea”), with wire fraud and money laundering in connection with a scheme to commit insider trading in Non-Fungible Tokens, or “NFTs,” by using confidential information about what NFTs were going to be featured on OpenSea’s homepage for his personal financial gain."
Inner City Press covered the trial (below) until, on May 2, 2023, Chastain was found guilty and his sentencing set for August 22. Inner City Press was in the courtroom as his attorneys hugged him.
On August 8, 2023, Chastain's sentencing memo was filed, asking for time served or probation with community service and/or home confinement and stating "we do not here argue the reasons why Nate maintains his innocence."
They argue that the property subject to forfeiture is cryptocurrency (ETH), citing the DDC case of US v. Sterlingov, which Inner City Press is also covering.
On August 15, the US Attorney's Office asked for 21 to 27 months, citing the 24 months that Judge Loretta A. Preska recently gave to Ishan Wahi of Coinbase.
On August 21, the eve of sentencing, Chastain's lawyers put in letter seeking to exclude fromt the loss amount "after-featured NFT purchases."
On August 22, Chastain was sentenced to three months in prison and a $50,000 fine. Inner City Press thread:
OK- near end of sentencing in US v Nate Chastain, described as 1st "NFT insider trading" case. But loss/gain amount is less than $50,000, defense lawyer Miller (who also repped Wahi) says. Judge has taken 5 minute break before announcing sentence.
All rise! Judge: Respect for the law and general deterrence militate for punishment. But he is a first time offender. There are mitigating curcumstances. He has a potentially promising future...
Judge: There was a 2017 case, a few thousand dollars of profit, less than a year sentence. Mr Chastain, I sentence you to 3 months in prison."
Chaistain appealed, and the conviction was vacated. On January 5, 2026 Judge Furman set a conference on possible retrial: " ORDERED that the parties appear for a conference in this matter on January 14, 2026, at 10:30 a.m. "
On January 12 the US Attorney's Office wrote in asking to cancel that, saying "the parties are negotiating a disposition of this matter.. order the filing of an update by January 21."
On January 21, a signed Deferred Prosecution Agreement was filed - on Patreon here
Watch this site.
More on Substack here
Inner City Press will continue to cover these cases.
The case is US v. Chastain, 22-cr-305 (Furman / Moses)
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