Robinhood Engineers Charged With Fraud Over Alleged Crypto Listing Trades

In brief

• Federal prosecutors charged two Robinhood engineers with commodities fraud and wire fraud.
• The employees allegedly traded perpetual futures using confidential information about upcoming crypto listings.
• Each defendant allegedly earned more than $50,000 from the scheme.

Two former Robinhood engineers allegedly used confidential information about upcoming cryptocurrency listings to make profitable trades on decentralized exchange Hyperliquid, federal prosecutors said Tuesday.

Hefu Chai, 36, and Huaisong “Jerry” Xiang, 30, each face one count of commodities fraud and one count of wire fraud.

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“Today’s charges make clear that corporate insiders cannot evade the securities and commodities laws by trading based on misappropriated information in derivatives like perpetual futures, tokenized securities, or other similar financial instruments,” U.S. Attorney Jamie McDonald said in a statement.

Perpetual futures, or “perps,” let traders speculate on an asset’s price—often with leverage—without owning it. Unlike conventional futures, the derivatives do not expire. Hyperliquid is one of the largest decentralized platforms for trading perps and has faced increased regulatory scrutiny.

According to the DOJ, the engineers allegedly used nonpublic information about upcoming Robinhood Crypto token listings to buy related perpetual futures before the announcements, earning profits “for their own benefit” between 2025 and 2026. Each defendant earned more than $50,000 from the alleged scheme, the Justice Department said.

In a statement emailed to Decrypt, a Robinhood spokesperson said the company "takes market integrity seriously and has zero tolerance for insider trading."