Robinhood Engineers Indicted for Insider Trading at Hyperliquid

Two Robinhood engineers have been indicted for fraud related to alleged insider trading at Hyperliquid. The two, Hu Pu Chai (36) and Huai Song Xiang (30), are accused of purchasing futures contracts before their employer announced new token listings.

New York Southern District prosecutors stated the pair violated commodity trading laws once and committed wire fraud once each. They reportedly earned over $50,000 individually from these trades.

Hyperliquid operates a decentralized exchange focused on perpetual futures—leveraged products with no expiration that allow investors to hold positions indefinitely. Prosecutors said the engineers traded between 2025 and 2026, allegedly using advance knowledge of which tokens Robinhood Crypto would list to buy futures contracts ahead of time.

Major broker listings typically drive token prices higher, allowing those with prior information to profit by selling before the announcement. U.S. Federal Prosecutor Jamie McDonald stated in a press release that this case highlights ongoing concerns about insider trading in crypto markets.

Hyperliquid has faced similar allegations before. In December 2025, investors spotted wallets shorting HYPE tokens ahead of unlock events, which the exchange denied as insider trading. The company claimed those wallets belonged to a former employee dismissed in early 2024 and that team members were prohibited from trading HYPE derivatives.

HYPE traded around $77 on Tuesday, down 4.5% over 24 hours, with a market cap of approximately $17.1 billion ranking it 11th globally. The case occurs as Robinhood expands its crypto business through its own blockchain and European perpetual futures and tokenized stock trading—though the company has yet to issue an official statement.