DOJ Charges Two Former Robinhood Engineers Over Crypto Listing Insider-Trading Scheme
Summary
- The U.S. Department of Justice said it charged two former Robinhood engineers with making illicit profits from nonpublic information related to cryptocurrency listings.
- The engineers allegedly used Robinhood’s cryptocurrency listing schedule to buy perpetual futures contracts on decentralized exchange (DEX) Hyperliquid (HYPE), earning more than $50,000 each.
- A U.S. federal prosecutor said corporate insiders cannot evade commodities and securities laws by using perpetual futures or tokenized securities to trade on nonpublic information.
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The U.S. Department of Justice has charged two former Robinhood engineers with profiting from nonpublic information related to cryptocurrency listings.
Cointelegraph reported on September 16 that the Justice Department recently charged the former engineers with fraud and related offenses. The two men allegedly learned Robinhood’s crypto listing schedule in advance and bought perpetual futures contracts for the tokens on decentralized exchange Hyperliquid, earning more than $50,000 each.
According to the Justice Department, the engineers had access to token-listing information through Robinhood’s internal channels. Authorities allege they used that information to open long positions on Hyperliquid and then closed them after prices rose following the tokens’ listing on Robinhood.
U.S. Attorney Jamie McDonald said corporate insiders cannot avoid commodities and securities laws by trading on nonpublic information through instruments such as perpetual futures or tokenized securities.
JOON HYOUNG LEE
gilson@bloomingbit.ioCrypto Journalist based in Seoul