Menlo Park Robinhood engineer arrested in crypto trading case

Menlo Park resident and Robinhood engineer Hefu Chai was arrested Tuesday on commodities fraud and wire fraud charges, the U.S. Department of Justice announced.

Chai, 36, and fellow engineer Huaisong “Jerry” Xiang, 30, are accused of using confidential information obtained through their work at Robinhood to trade cryptocurrency-linked futures contracts on Hyperliquid.

From March 2025 through February 2026, prosecutors allege, the pair bought futures contracts before Robinhood publicly announced it would add certain cryptocurrencies to its platform. Those announcements typically drove up the cryptocurrencies’ prices, according to a recently unsealed indictment.

Chai and Xiang allegedly made more than $50,000 in profits from the trades, the DOJ said in a news release. 

“Misappropriating confidential information to trade in the derivatives markets for personal benefit is illegal,” U.S. Attorney for the Southern District of New York Jamie McDonald said in a news release. “That is exactly what we allege Hefu Chai and Huaisong Xiang have done. 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.”