Robinhood Employees Charged with Crypto Insider Trading
Two former employees of Robinhood Markets Inc. (HOOD) have been charged with fraud for allegedly using confidential insider information to trade cryptocurrency-linked perpetual futures.
Hefu Chai, 36, and Huaisong Xiang, 30, worked at HOOD between 2025 and 2026 and purchased perpetual futures tokens on Hyperliquid, a decentralized exchange, ahead of the company's public announcements that the underlying cryptocurrency tokens would be listed on Robinhood Crypto.
The U.S. Attorney's Office for the Southern District of New York charged Chai and Xiang with one count each of violating the Commodity Exchange Act, alleging they profited more than $50,000 from their illicit trading.
'Misappropriating confidential information to trade in the derivatives markets for personal benefit is illegal,' said U.S. Attorney Jamie McDonald. 'That is exactly what we allege Hefu Chai and Huaisong Xiang have done.'
In related news, HOOD stock fell more than 3% at close on Tuesday after the CLARITY Act failed to advance in the Senate.