Robinhood, the cryptocurrency and stock trading platform, has confirmed its acquisition of over 55 million shares previously held by former FTX CEO Sam Bankman-Fried, known as SBF. The purchase, valued at approximately $606 million, was completed after obtaining approval from the US District Court for the Southern District of New York, as stated in an SEC filing on August 30. These shares were initially seized by the US Department of Justice in January.
This acquisition was long anticipated and had been approved by Robinhood's board of directors in the company's fourth-quarter 2022 report. Robinhood entered into a buyback agreement with the US Marshals Service, allowing them to purchase these shares without any claims, liens, interests, rights , or encumbrances. The shares were originally held by Bankman-Fried and FTX co-founder Gary Wang through Emergent Fidelity Technologies.
Bankman-Fried's holding company, Emergent Fidelity Technologies, filed for bankruptcy in February. This development followed the collapse of FTX and a subsequent legal dispute over the ownership of approximately $600 million worth of Robinhood stock. BlockFi, a c cryptocurrency lending firm, filed for bankruptcy after FTX's collapse, and Bankman-Fried, BlockFi, and FTX creditor Yonathan Ben Shimon have been entangled in a legal battle over the assets. Bankman-Fried is currently in custody, with his first trial scheduled to begin on October 3.
Following the purchase, Robinhood's stock price saw a 4% increase on Nasdaq, rising from $10.85 to $11.34 at the time of this report. Interestingly, recent investigations have revealed that Robinhood is now the fifth-largest owner of an Ethereum wallet, holding asset s valued at over $2.5 billion.
