Two former Robinhood engineers have been charged in a Hyperliquid insider trading case, accused of using advance knowledge of upcoming crypto listings to place futures trades before the announcements.
Hefu Chai, 36, and Huaisong Xiang, 30, were each charged Tuesday with one count under the Commodity Exchange Act and one count of wire fraud. Prosecutors allege that both made more than $50,000 from the trades.
According to the U.S. Attorney’s Office for the Southern District of New York, the alleged activity took place between 2025 and 2026. The two engineers reportedly knew which tokens Robinhood Crypto planned to list and bought perpetual futures on those assets before the listings became public.
The strategy hinged on a familiar market reaction. A listing on a major broker can push a token’s price higher, creating an opportunity for someone who already holds a position to sell into the move.
Hyperliquid insider trading puts private information under the microscope
Hyperliquid is a decentralized exchange centered on perpetual futures, derivatives that let traders take leveraged positions without an expiration date.
That structure made it possible for the alleged trades to be positioned around anticipated listing announcements rather than the tokens themselves. Prosecutors say the engineers turned confidential information available through their work into personal trading profits.
“Misappropriating confidential information to trade in the derivatives markets for personal benefit is illegal,” U.S. Attorney Jamie McDonald said in the statement.
The allegation also lands on familiar territory for Hyperliquid. In December 2025, traders raised insider trading claims after a wallet appeared to short HYPE around a token unlock.
Hyperliquid denied that its employees were behind the trades. The exchange said the wallet belonged to a former employee who had been dismissed in early 2024, and that team members are prohibited from trading HYPE derivatives.
Robinhood, meanwhile, said it has a strict policy against insider trading involving new crypto listings.
“Robinhood takes market integrity seriously and has zero tolerance for insider trading. We have robust insider trading policies and procedures in place, including for new crypto listings. We immediately investigated and reported this matter to law enforcement and regulators, and will continue to cooperate with the investigations,” a company spokesperson told BeInCrypto.
The case comes as Robinhood pushes further into crypto, with its own blockchain, perpetual futures in Europe and tokenized stock trading. That expanding footprint makes the handling of confidential listing information an increasingly visible part of the company’s crypto operations.