Sam Bankman-Fried went on an investment spree in 2022, where he acquired stakes in a lot of crypto platforms and exchanges. One of his major investments during the time was in Robinhood, where he bought 7.6% of the company stakes for $648 million. SBF received a total of 56 million shares in the deal. This was positive for the exchange at the time as Robinhood’s share price jumped 30% when SBF revealed its stake. But now US authorities seize FTX’s Robinhood shares as multiple parties stake their claims on FTX’s assets after its collapse.
FTX’s collapse and Robinhood’s shares
BlockFi recently sued Sam Bankman-Fried because he used Robinhood’s shares as collateral. During the purchase of the shares, SBF borrowed funds from Alameda Research, and after the purchase, Alameda pledged those shares as collateral to take a loan from BlockFi.
Everything was alright till this point, but just before the collapse of FTX, SBF pledged those shares again to get another loan. So, he broke the agreement and defaulted on the collateral. This is why BlockFi now demands that he hands over the collateral to them.
US authorities jump in
As things got more complicated regarding the ownership of Robinhood’s shares, the US authorities decided to jump in. They have seized or are in the process of seizing $400 million worth of the exchange’s shares, which were linked to FTX.
Reuters reported that US officials had informed the judge involved in the FTX case that they were seizing 56 million shares of Robinhood. This was after the judge ordered SBF not to access or transfer any crypto asset from FTX or Alameda Research.
It will be interesting to see which party gains control over the assets once the US authorities seize them. BlockFi, SBF and even FTX’s creditor Ben Shimon have requested that the assets be transferred to them.
SBF is now allegedly the largest fraudster in the history of the US. Even his partners, Gary Wang and Caroline Ellison have pleaded guilty to the fraud charges against them. Despite all that, he has pleaded not guilty in court to all the charges against him.
What are your thoughts as US authorities seize FTX’s Robinhood shares worth $460 million? And who do you deserve to get the stakes? Let us know in the comments below. And, if you found our content informative, share it with your family and friends.
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