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Robinhood (HOOD) Former Staffers Charged in Crypto Trading Fraud Case

Stockwhiz•15/09/2026•15:59 ET
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Two former Robinhood Markets employees were charged with fraud after allegedly using confidential cryptocurrency-listing information for trades that prosecutors said made them more than US$50,000 each.

Two former Robinhood Markets (HOOD) employees were charged by United States prosecutors with fraud for allegedly using nonpublic information to trade crypto-linked perpetual futures on the decentralized derivatives exchange Hyperliquid.

The former engineers, Hefu Chai, 36, and Huaisong Xiang, 30, allegedly made more than US$50,000 each from the trades, according to a statement Tuesday from Manhattan U.S. Attorney Jamie McDonald.

Key details

  • Prosecutors identified the former Robinhood employees as Hefu Chai and Huaisong Xiang.
  • The alleged trades involved crypto-linked perpetual futures on Hyperliquid.
  • Each allegedly made more than US$50,000 from the trades.
  • The trades allegedly occurred between 2025 and 2026.
  • Both are scheduled to appear in court Tuesday.

Alleged use of confidential crypto listing information

Prosecutors allege that Chai and Xiang used confidential information about whether and when Robinhood would support additional cryptocurrencies. They allegedly used that information to buy crypto-linked perpetual futures on Hyperliquid.

Chai, of Menlo Park, California, and Xiang, of Jersey City, New Jersey, allegedly carried out the trades between 2025 and 2026, according to the statement.

Robinhood says it reported the matter

“Robinhood takes market integrity seriously and has zero tolerance for insider trading,” a company spokesperson said in an emailed statement. “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 their investigations.”

The spokesperson said Chai and Xiang are no longer Robinhood employees. The company did not provide further details about their departures.

Court appearances and responses

Chai and Xiang are scheduled to appear in court in California and New York, respectively, on Tuesday.

Chai did not immediately respond to a LinkedIn message requesting comment on the charges. Robert Stahl, a lawyer representing Xiang, said his client denies the charges and will vigorously defend himself in court.