00:00A crypto trader stands accused of insider trading, but proving it will be challenging, and market experts say charges are unlikely.
00:10That trader, operating under the alias Garrett Bullish, shorted the crypto market shortly before President Trump announced major tariffs on China.
00:19That post sent the crypto market plummeting, making that investor millions.
00:23Insider trading in crypto works similar to betting against the regular market.
00:27If you know in advance something like that, so it's definitely technically possible, largely in the same way as the financial markets.
00:36That trader has since refuted claims of insider trading and put out a lengthy social media post explaining their decision to short the market.
00:44Shorting the market was probably a rational decision at that time for anybody anyway.
00:48At the time, I was just like, OK, someone got lucky. Great.
00:51And then afterwards, I was like, OK, all right, I can see how people might get might get suspicious, might get skeptical.
00:58Many of the calls of insider trading centered around that trader having connections to the Trump administration.
01:04Bullish denied those allegations.
01:06But given the Trump family's ties to crypto, it's not a far fetched connection to make.
01:11Yeah, it does make sense, especially given the tight connections between people in the crypto world and people in Trump's orbit.
01:20You could easily imagine someone getting wind that, you know, he was going to make this post on Truth Social.
01:26Trump and his sons, Eric and Donald Jr., co-founded a cryptocurrency company that now holds hundreds of millions of dollars in crypto.
01:34That, again, speaks to that real tight relationship between the Trump administration and the crypto world, which is, you know, a problem, right?
01:42And this is an example of why it's a problem.
01:44Even if there's nothing nefarious going on, people are going to assume there is because they've seen the banquet at the White House.
01:52At this point, it's all just allegations and likely to remain that way.
01:56Cryptocurrency isn't regulated like the stock market.
01:59Therefore, proving or punishing alleged insider trading will be tough.
02:04Crypto markets are largely decentralized, so we don't actually know who is responsible and so on.
02:09We don't have very good laws in this regard.
02:12What this incident does show is that crypto is moving more with the regular market.
02:17Crypto used to operate more like gold, moving independently of the stock market.
02:22But now, as it becomes more understood, it's also being purchased by institutional investors.
02:27If they're taking a hit, crypto is taking a hit.
02:29So, yeah, I don't I still wouldn't say that it shows that crypto is more mainstream or that this is a mature market.
02:35But it definitely shows that crypto is more intertwined now with the rest of the overall market.
02:42For Straight Arrow News, I'm Lauren Keenan.
02:44If you want more on this story, download the Straight Arrow News app or visit san.com.
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