Robinhood and Webull Shares Drop After Charges Against Former Engineers Over Crypto Trades
Robinhood (NASDAQ:HOOD) fell nearly 5% after U.S. prosecutors reportedly charged two former engineers with front-running crypto listings, each allegedly making over $50,000 in profits from the trades. The charges relate to trading on Hyperliquid ahead of Robinhood's public announcements about listing certain tokens. Webull (NASDAQ:BULL) dropped more sharply by 9%, reflecting sympathy selling among retail brokers exposed to cryptocurrency markets. The sell-off appears tied specifically to regulatory and reputational risks rather than a broader crypto market downturn, as the iShares Bitcoin Trust ETF (IBIT) fell less than 1% while the S&P 500 proxy SPY rose slightly. The decline also follows the Senate's failure on Tuesday to advance the CLARITY Act digital asset bill, adding pressure before these legal developments. Robinhood was not directly accused of wrongdoing in the charges, which were filed against individuals rather than the company itself.
Topics: crypto trading front-running Robinhood stock market reaction Webull