Emergent Technologies has agreed with the bankrupt crypto exchange FTX regarding acquiring over $600 million in Robinhood shares.
FTX CEO John Ray III filed a motion in a Delaware Bankruptcy Court on September 6 that stated the company will reimburse Emergent $14 million for administrative expenses associated with its withdrawal of a petition to claim 55 million Robinhood shares and cash.
The settlement also enables Emergent to expedite resolving its bankruptcy case in Antigua.
FTX stated that the agreement is a critical component of its reorganization plan to optimize value for creditors, as it facilitates the recovery of additional funds for its creditors and helps prevent additional litigation expenses.
Ray stated in a declaration on September 6 that the agreement was the outcome of “good faith arm’s length negotiations between the parties” and that these negotiations were “free of any collusion.”
In May 2022, Emergent agreed with Bankman-Fried and Alameda Research, the crypto trading firm he founded, to acquire approximately 56 million Robinhood shares, valued at roughly $600 million.
The Justice Department seized the shares in January 2023 following FTX’s collapse in November 2022, and several parties, including FTX, BlockFi, Bankman-Fried, and Emergent, have claimed ownership or rights to it.
On September 1, 2023, Robinhood liquidated the shares and repurchased them for approximately $606 million.
Bankman-Fried and Gary Wang, a former co-founder of FTX, jointly established Emergent Fidelity Technologies, an offshore investment firm that filed for Chapter 11 bankruptcy in February 2023.
Bankman-Fried was sentenced to 25 years in prison in late March for his involvement in a significant fraud that resulted in the collapse of numerous high-profile crypto companies, including his own.
There is an upcoming hearing on the motion on October 22.
