These charges mark a new development in insider-information enforcement within the crypto markets, where confidential information from one company can be exploited through derivatives trading on a separate decentralized platform. Both Chai and Xiang face one count of commodities fraud and one count of wire fraud, with potential maximum sentences of 10 years and 20 years, respectively.

Chai, who worked at Robinhood from around 2021 to May 2026, was a technical lead involved in new digital-asset listings. Xiang, on the other hand, worked as a software engineer from about 2024 to September 2026. Their roles gave them access to a private Slack channel containing upcoming listing plans. Both were designated as “Coin Aware Individuals,” allowing them to receive information about new token availability at Robinhood Crypto.

Despite Robinhood’s policies prohibiting employees from trading while in possession of material nonpublic information, as well as restricting them from trading affected assets on any platform before and after an announcement, prosecutors allege that Chai and Xiang engaged in illicit trading activities.

US Attorney Jamie McDonald stated that misappropriating confidential information for personal gain in the derivatives markets is illegal and emphasized that corporate insiders cannot evade securities and commodities laws by trading based on misappropriated information.

The government’s case focuses on the period between when a token became tradable on Robinhood and when the company publicly announced the listing. Prosecutors noted that tokens could be traded on Robinhood up to an hour before the official announcement, creating a window for employees with advance knowledge to potentially exit positions before the news became public.

Chai and Xiang allegedly used this window to their advantage, making profitable trades on Hyperliquid, a decentralized derivatives platform. The case brings to light the use of confidential listing information in decentralized derivatives markets, raising questions about how commodities-fraud statutes apply when the information source and trading venue are separate.

Robinhood has cooperated with the investigation, and the Justice Department stated that the company may need to reassess how it handles listing information internally and monitors employee trading restrictions across external crypto platforms as the case unfolds.

A Farewell to CoinEx: Cryptocurrency Exchange Shuts Down After Nearly a Decade

After nearly a decade in the business, CoinEx, a cryptocurrency exchange based in the Seychelles, has announced its closure. The decision to wind down operations comes as a result of market downturns, declining volumes, and increasing regulatory costs.

Founder and CEO Haipo Yang made a public statement emphasizing user protection, stating that all user assets are fully backed and available for withdrawal. Withdrawals opened on September 15, 2026, and will remain available until 02:00 UTC on December 22, 2026. The platform, which launched on December 22, 2017, will officially cease operations exactly nine years later.

In his statement, Yang mentioned that despite considering selling the platform, he believed that an orderly wind-down was the best way to end CoinEx’s journey. He also announced that CET tokens, the exchange’s utility token, would be repurchased at the initial price of 0.005 USDT with no cap. Currently trading at $0.00049, CET has seen a significant decrease from its all-time high of $0.15 in 2018.

Services on the platform will phase out gradually through September, with wallets and vaults remaining unaffected. After the deadline, a 5% monthly custody fee will be applied until the claim cutoff on August 22, 2028.

The closure of CoinEx follows a lawsuit filed by New York State Attorney General Letitia James in 2023, which led the exchange to exit the US market. CoinEx settled the lawsuit for over $1.7 million in June of the same year.

As CoinEx bids farewell to its users, the cryptocurrency community reflects on its nearly decade-long presence in the industry. Despite the challenges faced, the exchange maintained a commitment to user protection and asset security until the very end.

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Featured Image: Shutterstock/Mia Stendal/Hoowy

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