Robinhood Engineers Charged With Fraud Over Alleged Crypto Listing Trades

Federal prosecutors announced charges against two former Robinhood engineers who are accused of trading on confidential information about planned cryptocurrency listings. The Department of Justice says Hefu Chai and Huaisong “Jerry” Xiang purchased perpetual futures related to tokens Robinhood Crypto intended to list, doing so before the company made public announcements.

According to the indictment, the trades were executed on Hyperliquid, a major decentralized platform for perpetual futures—derivatives contracts that allow traders to speculate on an asset’s price without an expiration date, often using leverage. Prosecutors say the trades yielded profits of more than $50,000 for each defendant during 2025–2026.

Prosecutors are pursuing the case under the Commodity Exchange Act, treating the alleged misconduct as commodities fraud tied to derivatives rather than bringing securities fraud charges. U.S. authorities noted Robinhood cooperated with the investigation; the company told reporters it enforces strict insider-trading policies, investigated the matter promptly, and reported findings to law enforcement and regulators.

The charges come amid broader enforcement activity in the crypto sector involving confidential listing information. Federal authorities previously charged a former Coinbase manager in a related token-listing scheme. If convicted in this new case, the commodity fraud count carries a maximum prison term of 10 years and the wire fraud count up to 20 years. An editor’s note to the reporting clarified that those charged are former Robinhood employees and added the company’s comment.