Robinhood, a cryptocurrency and stock trading platform, has announced the acquisition of more than 55 million shares of the company previously held by Sam Bankman-Fried (SBF) for $606M.
According to a blog post published on August 31, Robinhood acquired 55,273,469 shares for approximately $606 million after filing with the United States Securities and Exchange Commission.
In January, the U.S. Department of Justice impounded the shares held by Bankman-Fried and FTX co-founder Gary Wang through Emergent Fidelity Technologies.
The purchase was anticipated. The U.S. District Court approved the deal for the Southern District of New York, according to an SEC filing dated August 30.
Robinhood’s board of directors approved the transaction in the company’s Q4 2022 report. Robinhood and the U.S. Marshals Service entered into a repurchase agreement.
Jason Warnick, chief financial officer of Robinhood, stated, “We are pleased to have completed the purchase of these shares and look forward to executing our growth plans on behalf of our customers and shareholders.”
Emergent Fidelity Technologies, the holding company of Bankman-Fried, filed for bankruptcy in February. Due to the 55 million Robinhood shares pledged as collateral, the company was already a target of the crypto lending firm BlockFi, which declared bankruptcy after the collapse of FTX.
During FTX’s bankruptcy proceedings, SBF, BlockFi, and FTX creditor Yonathan Ben Shimon fought in court over the proprietorship of approximately $600 million worth of Robinhood shares.
The legal team for Bankman-Fried argued that the former FTX CEO had a right to the assets to fund his criminal defense. As a result of a judge revoking his parole on August 11, Bankman-Fried is currently incarcerated. His first trial is scheduled to begin on October 3.
At the time of publication, the price of Robinhood shares on Nasdaq increased by approximately 4%, from $10.85 to $11.34. Recently, crypto detectives revealed that the company owned the fifth-largest Ether wallet, worth over $2.5 billion.
