Robinhood Engineers Charged With Crypto Insider Trading on Hyperliquid

Two former engineers at Robinhood, Hefu Chai and Huaisong Xiang, have been charged by the US Department of Justice for allegedly engaging in crypto insider trading on Hyperliquid.

The charges stem from their alleged use of confidential information about upcoming Robinhood crypto listings to trade perpetual futures ahead of the announcements. Both men worked at Robinhood in roles that gave them access to this sensitive information, and both ignored company policy prohibiting employees from trading on any platform 24 hours before or after a listing announcement.

The alleged scheme involved Chai and Xiang buying perpetual contracts on Hyperliquid tied to various tokens before the listings went live. Once the prices moved up, they closed their positions for a profit. The pair allegedly traded ahead of at least 10 listing announcements each, with Chai trading Cat in a Dogs World, Moo Deng, Aster, Plasma, Hyperliquid, Ethena, and Aerodrome Finance, among others.

Each defendant allegedly made more than $50,000 from the trades. If convicted, they face up to 10 years for violating the Commodity Exchange Act and 20 years for wire fraud.