Sam Bankman-Fried, the former CEO of FTX, is linked to 56 million shares of Robinhood that the American government has reportedly seized or will soon seize (SBF).
The 30-year-old recently asked a US bankruptcy court for assistance in order to take ownership of the HOOD stocks.
SBF Takes Another Punch
According to a Bloomberg report, Bankman-shares Fried’s in Robinhood are being seized by the American government for a total of $468 million. The source claimed that the seizure may have already been finished by the authorities.
The operation is a component of the extensive legal case brought against the former executive of FTX, who is accused of a number of offenses, including wire fraud and money laundering.
In May of last year, SBF made a 7.6% investment in the financial services firm, praising Robinhood as a “attractive investment.” According to recent reports, the former crypto tycoon partnered with FTX Co-Founder Zixiao (Gary) Wang to finance the deal by borrowing more than $500 million from Alameda Research. SBF acquired 90% of the 56 million shares, and Wang retained 10%.
Later, Bankman-Fried and Caroline Ellison, the former CEO of Alameda, used the stocks as security to get a loan from cryptocurrency lender BlockFi, which resulted in a significant dispute in the months that followed.
SBF, BlockFi, and FTX creditor Yonathan Ben Shimon were three parties who asserted ownership of the stash. Even requesting that the others be prevented from claiming ownership of the shares, the defunct exchange.
The HOOD stake was frozen by Emergent’s broker, ED&F Man Capital Markets, in mid-November (shortly after FTX and Alameda Research filed for bankruptcy protection). Before filing, Bankman-Fried reportedly attempted to sell the stocks using the Signal application.
No Acquisition Deal
In the first half of 2022, FTX rapidly grew its presence by acquiring numerous cryptocurrency businesses. According to some reports from the summer of last year, Vlad Tenev’s Robinhood would be the platform’s next target. Although SBF stated in the days that followed that he enjoys the brokerage app, he clarified that FTX had no plans to actually buy it:
“The company Vlad and his team have established has always left me in awe. Therefore, Robinhood and M&A are not currently being discussed.