Robinhood Engineers Charged With Crypto Trading Scandal

Two former Robinhood engineers, Hefu Chai and Huaisong Xiang, have been charged with commodities fraud and wire fraud by the U.S. Attorney for the Southern District of New York.

The charges allege that both men used confidential information about upcoming Robinhood Crypto listings to trade perpetual futures on Hyperliquid, a venue not operated by Robinhood, before public announcements were made.

Prosecutors claim that Chai and Xiang, who worked as engineers at Robinhood, had access to information about listing plans for certain tokens through a private Slack channel. They allegedly opened positions in perpetual futures on Hyperliquid before the listings became public, then closed the positions after the announcements.

Each man is accused of making over $50,000 from these trades, and could face up to 10 years in prison under the Commodity Exchange Act and up to 20 years for wire fraud.