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I've always wondered where the line is drawn for insider trading. What is material non-public Information? Say you find easily calculable mathematical solution

I've always wondered where the line is drawn for insider trading. What is material non-public Information? Say you find easily calculable mathematical solutions that break the security of crypto and you dump all your coins because you know they'll be worthless once you publish your research/algorithm. Is that insider trading? Or would you be in the clear because you derived your algorithm from already public information that everyone else already had too? Does the time scale matter? If you solve, dump, wait a few years, then publish, is it no longer insider trading?

zharknado 3y ago
IANAL but that doesn’t sound like insider trading to me. That’s more like activist short-selling à la Hindenburg Research. This is assuming you don’t have ties to the organization that issues the token, if one exists.
maxlybbert 3y ago
In the US, insider trading requires material nonpublic information, but it officially also requires that somebody break a fiduciary duty to the company involved. So, in your hypothetical, the person breaking cryptography algorithms knows something nobody else does (i.e., isn’t public), and that secret is definitely material. But the researcher didn’t get that information through a breach of fiduciary duty, so it’s legal to trade.