By Shiela Bertillo and Michael Mislos
With the recent controversy surrounding the $LIBRA memecoin, key figures in the crypto space are weighing in on the broader implications of insider trading.
One such figure in the local crypto space is George Asibal, CEO of ZFT, a prominent trading organization, who previously asserted that crypto trading is largely an insider’s game.
- When asked whether he still stands by his past statement, Asibal replied in the affirmative in a new statement sent to BitPinas. (Asibal’s full statement can be found at the end of the article.)
Asibal’s Original View on Insider Trading Advantage
Asibal had previously stated:
“If there’s one thing that I’ve learned in Crypto, it’s that it’s an insider’s game. If you want the best edge, then you need to find the right connections that can vouch if these low-cap coins will do great or not.”
This perspective was shared in the context of why many Filipinos prefer high-risk, low-cap cryptocurrencies over more established assets like Bitcoin or Ethereum.
Does He Still Think Crypto is an Insider’s Game?
Following the $LIBRA controversy, where Argentina’s President Javier Milei was accused of fraud and Solana platforms Jupiter and Meteora are accused of insider dealings and manipulation, Asibal addressed the ethical and legal complexities of insider trading in crypto.
“I stand by this statement because it is what it is. Early information from legitimate sources is an edge. Whether or not it is lawful or morally acceptable is the question.”
George Asibal, CEO, ZFT
He went on to differentiate between permissible insider knowledge and outright fraud, citing the distinction between:
Asibal stressed the importance of understanding legal boundaries when investing, likening it to knowing the rules of a game to play it better than others.
The ZFT CEO’s reply to BitPinas ended with a question, referring to the practice of observing other people’s wallets, all viewable on the blockchain, and copying their trades or holdings. :
“If you copied wallets because they have good profitability, not knowing they are insiders, would that make you an insider?”
George Asibal, CEO, ZFT
Full Statement from George Asibal
Below is the full comment from the subject, edited for formatting only.
If there’s one thing I’ve learned in crypto is that it’s an insider’s game. If you want the best edge, then you need to find the right connections that can vouch if these low cap coins will do great or not.
I stand by this statement because it is what it is. Early information from legitimate sources is an edge. Whether or not it is lawful or morally acceptable is the question.
Generally speaking, insider trading is not allowed.
What is insider trading?
- It is the illegal practice of trading stocks or securities based on confidential, non-public information to gain an unfair advantage.
For some unregulated asset classes in the cryptospace like Meme-coins or NFTs, I believe there is a gray area. And this is the main reason why Crypto was made anyways. Transparency and Decentralization. There are many other factors to consider like if the country you reside in have laws relating to the assets you are trading – even crypto.
I’ll give you an example of what’s acceptable based on my statement:
- Say you know a player in the space who’s well connected with founders and builders. He vouches that a certain reputable player will be launching their meme-coin or has an ongoing pre-sale and points you to their website or x account. Buying into the sale or buying into the project while not everyone is aware of its existence is generally okay. You take the risk and it’s a meme-coin not a security. This is fine since you’re based in the Philippines.
What’s not okay is the case of $LIBRA
Because you have a Government Official launching an asset, promising economic incentive, filled with insider-players acting in bad faith. Even if there are some legal gray areas, this is morally unacceptable and we can see the obvious result of this stunt.
Here’s an overview of the key laws implicated:
- Article 265 of the Argentine Penal Code: This article prohibits public officials from using their position for personal financial benefit or that of a third party, with penalties of up to six years in prison. Critics argue that Milei’s promotion of $LIBRA via his official X account may have leveraged his presidential authority to artificially inflate the token’s value, potentially benefiting insiders who cashed out millions before the crash. Legal experts, including constitutional lawyer Andrés Gil Dominguez, have suggested this could apply if Milei knowingly endorsed a fraudulent scheme.
- Article 172 of the Argentine Penal Code: This law addresses fraud through deception, penalizing actions that mislead others into financial loss for personal gain. The $LIBRA token surged to a $4.5 billion market cap after Milei’s endorsement, only to plummet 90% within hours as insiders withdrew substantial liquidity (estimated at $87 million to $107 million). Lawyers, such as Jonatan Baldiviezo, allege this constitutes a coordinated fraud, with Milei’s involvement seen as pivotal in deceiving investors.
- Article 310 of the Argentine Penal Code: This prohibits unlicensed financial intermediation. The $LIBRA token was marketed as a means to fund small businesses, but lacked regulatory approval or oversight from Argentina’s financial authorities, like the Central Bank or the National Securities Commission (CNV). If the token operated as an unlicensed financial instrument, its promotion and distribution could violate this statute.
- Public Ethics Law (Law 25,188): This law governs the conduct of public officials, forbidding them from engaging in activities that conflict with their duties or involve personal enrichment. Milei’s endorsement of a private crypto project, followed by its collapse, has been cited as a breach of this law, with plaintiffs arguing it undermined public trust and violated ethical standards. Baldiviezo and others claim Milei’s actions contravened this by promoting a speculative asset tied to personal or insider gain.
When you invest into things, know your legal boundaries. Just like a game, know the rules of the game, and play better than anyone else.
Here’s a question for everyone to think about..
If you copied wallets because they have good profitability, not knowing they are insiders, would that make you an insider?
This article is published on BitPinas: Crypto Remains An Insider’s Game — ZFT’s George Asibal
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