The purchase of Robinhood shares worth 55 million has been anticipated after consent from the United States district court and the firm’s board.
Robinhood, a cryptocurrency and stock trading network, has publicly acquired more than 55 million company shares earlier held by Sam Bankman-Fried (SBF), ex-FTX chief executive officer.
Robinhood Repurchases Stake Held by Former FTX Executive
An August 31 post revealed the platform’s completion of a purchase of 55,273,469 shares for nearly $606 million after a filing with the U.S Securities and Exchange Commission. These shares were previously held by SBF and Gary Wang, FTX cofounder, via Emergent Fidelity Technologies. In January, the United States Department of Justice seized them.
This purchase has been anticipated. In the firm’s Q4 2022 report, the board of directors publicized the deal’s approval, and a filing on August 30 claimed the United States District Court for the Southern District of New York had permitted the purchase clear of interests, claims, charges, and impediments.
Repurchase of Bankman’s Shares Adds Twist to BlockFi Versus Emergent Tussle
Jason Warnick, Robinhood’s chief financial officer, claimed they were happy to finalize the shares’ purchased and looked forward to implementing the firm’s growth plans on behalf of its clients.
Emergent Fidelity Technologies, SBF’s holding firm, filed for insolvency in February. By then, it was crypto lending company BlockFi’s target, which filed for insolvency after FTX’s collapse, over the 55 million Robinhood shares guaranteed as security.
Amid FTX’s insolvency proceedings, BlockFi, Bankman-Fried, and Yonathan Ben Shimon, an FTX creditor, had been having legal wars regarding the possession of the nearly $600M in Robinhood shares.
SBF’s attorneys claimed the ex-FTX CEO had a claim to these assets to pay for his criminal defense. He is incarcerated after a judge canceled his bail on August 11 and is expected to appear in court starting on October 3 for the initial trial.
Robinhood shares’ prices on the Nasdaq rose nearly 4% after the purchase. It increased from $10.85 to $11.34. Recently, crypto investigators claimed that the company owned the fifth-biggest Ether wallet, worth above $2.5 billion.
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