Federal prosecutors have charged two Robinhood engineers with commodities fraud and wire fraud for allegedly trading perpetual futures based on confidential information about upcoming cryptocurrency listings on Robinhood Crypto.
The U.S. Department of Justice identified the defendants as Hefu Chai, 36, and Huaisong “Jerry” Xiang, 30. According to prosecutors, between 2025 and 2026, they misappropriated nonpublic details about planned token listings and placed trades on the decentralized derivatives platform Hyperliquid before public announcements. Each allegedly earned more than $50,000 from the scheme.
“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.
The charges rely on the Commodity Exchange Act, treating the conduct as insider trading in derivatives rather than securities fraud. If convicted, the commodities fraud count carries a maximum sentence of 10 years in prison, while wire fraud carries a maximum of 20 years. Robinhood cooperated with the investigation, authorities said.
The case follows a federal precedent from 2022, when former Coinbase product manager Ishan Wahi was charged over confidential token-listing information. It also adds regulatory attention to Hyperliquid, one of the largest decentralized platforms for perpetual futures trading.
