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Robinhood engineers charged with crypto fraud
Two former Robinhood engineers, Hefu Chai and Huaisong “Jerry” Xiang, have been charged by the U.S. Department of Justice with commodities and wire fraud. Prosecutors allege the pair engaged in an insider trading scheme between 2025 and 2026, using confidential information regarding upcoming cryptocurrency listings on the Robinhood Crypto platform.
According to the indictment, the defendants misappropriated nonpublic data from a private Slack channel to identify which tokens were slated for listing. Instead of purchasing the tokens directly, they allegedly used this information to trade perpetual futures on the decentralized exchange Hyperliquid. This allowed them to gain leveraged exposure to anticipated price surges following official announcements.
Each defendant is alleged to have earned more than $50,000 from these illicit trades. The charges include violations of the Commodity Exchange Act. Chai, 36, faces a maximum of 10 years for commodities fraud and 20 years for wire fraud, while Xiang, 30, faces similar potential penalties. Robinhood stated it has zero tolerance for insider trading and has cooperated with law enforcement. The defendants are presumed innocent unless convicted.
Entities
Department of Justice · Hefu Chai · Huaisong Xiang · Hyperliquid · Robinhood · Robinhood Markets, Inc. · U.S. Department of Justice
Claims
What the coverage asserts, and how many sources carry each claim.
- [● 9 SOURCES] The alleged scheme occurred between 2025 and 2026. forbesliberia.com · nosmokesport.com · crypto.news · www.cryptobreaking.com · www.almanacnews.com · +4 more
- [● 10 SOURCES] Hefu Chai and Huaisong Xiang allegedly earned more than $50,000 each from the illicit trades. forbesliberia.com · nosmokesport.com · crypto.news · www.cryptobreaking.com · www.almanacnews.com · +5 more
- [● 9 SOURCES] The DOJ has charged two former Robinhood engineers with commodities and wire fraud. forbesliberia.com · nosmokesport.com · crypto.news · www.cryptobreaking.com · www.almanacnews.com · +4 more
- [● 3 SOURCES] The defendants are presumed innocent unless convicted. crypto.news · www.cryptobreaking.com · forbesliberia.com
- [● 9 SOURCES] The defendants allegedly used confidential information to trade perpetual futures on the decentralized exchange Hyperliquid. forbesliberia.com · nosmokesport.com · crypto.news · www.cryptobreaking.com · www.almanacnews.com · +4 more
- [● 2 SOURCES] Hefu Chai faces a maximum of 10 years for commodities fraud and 20 years for wire fraud. crypto.news · www.sondakika.com