Mysterious Trader Suspected of Insider Trading on Futu, Profiting Over $100 Million; Susquehanna Files Lawsuit
0xBroomberg
Options market-maker Susquehanna is suing up to 100 unidentified traders, alleging they used inside knowledge of a CSRC crackdown on Futu and UP Fintech to turn roughly $12 million in put options into more than $100 million — while Susquehanna lost $71.4 million on the other side.
How precise was the trade?
The suspicious options activity ran from May 7 to May 21, 2025 — a concentrated burst of put-option purchases on Futu and UP Fintech.
Most contracts were short-dated, with strike prices far below the prevailing stock price. This means → if no major negative news hit within days, every contract would expire worthless.
On May 22, the CSRC (China Securities Regulatory Commission) announced both companies had served mainland clients without proper licenses; shares plunged. In plain terms = the traders spent roughly $12 million, hit the regulatory window dead-on, and walked away with over $100 million — a return exceeding 900%.
Why is this potentially "one of the largest insider-trading cases in years"?
The complaint draws a direct comparison to the Galleon Group case — hedge-fund founder Raj Rajaratnam was convicted of insider trading with total illegal profits of $53.8 million.
This means → the suspected gains here are nearly twice that landmark figure.
Susquehanna, one of the largest options market-makers in the U.S., lost $71.4 million on these trades — a rare public disclosure of a significant single-event loss for the firm.
Who are the suspects?
The lawsuit names up to 100 "John Does" as defendants. Most trades were routed through roughly nine Interactive Brokers accounts; a smaller portion went through Futu's and UP Fintech's own platforms.
Susquehanna narrows the suspect pool to two groups: insiders at the CSRC who knew the crackdown was coming, or employees at Futu or UP Fintech who learned of the regulatory action in advance.
The complaint asks the court to freeze the accounts and compel the platforms to reveal the traders' identities. The CSRC, Futu, UP Fintech, and Interactive Brokers have all declined to comment.
What does this mean for the market?
For market-makers, this reflects a structural vulnerability: when a counterparty holds inside information, quantitative pricing models cannot detect the asymmetry.
In plain terms = the models assume everyone trades on the same public information. An insider breaks that assumption — and the more precise the model, the larger the loss when it gets picked off.
The central legal question is whether the tight alignment between the options-trading window and the regulatory announcement is enough to prove insider trading in court — timing correlation is not the same as legal proof, and that gap will be the trial's focal point.
Content is for reference only, not financial advice.