Robinhood Could Buy Back its Equity from SBF for $578M

  • “The proposed share purchase underscores the confidence the Board of Directors and management team have in our business,” Robinhood said
  • Now that Robinhood has the board’s approval, it would try its best to regain the equity from the fallen crypto giant

Robinhood, a U.S.-based trading platform, is planning to buy back its shares that were bought by a company of Sam Bankman Fried and his co-founder, Gary Wang.

According to an affidavit filed by Sam Bankman Fried in the court during FTX’s insolvency proceedings, he along with Gary registered a new company to acquire the Robinhood shares. The company was named Emergent Fidelity Technologies and it bought 55 million shares or roughly 7 percent of the company for $578 million dollars.

However, while releasing the fourth quarter report, Robinhood Market Inc. confirmed that they have finally received the board’s approval to buy back the entire equity from Emergent Fidelity.

“The proposed share purchase underscores the confidence the Board of Directors and management team have in our business”

However, the three parties claiming the shares include FTX creditor Yonathan Ben Shimon, BlockFi, and SBF.

BlockFi Demands Robinhood Shares

BlockFi, a digital asset lending platform, has also claimed the Robinhood shares as SBF had used them as collateral for a loan. Right now, this claim is being contested in the court as SBF had asked the court to not release them for BlockFi. According to SBF, Emergent Fidelity had not filed for bankruptcy with the other sister firms of FTX, it could not be liquidated for FTX’s liabilities. However, Emergent Fidelity filed for Bankruptcy Protection last week.

SBF and Wang had also taken a loan from Alameda Research for buying seven percent of Robinhood. SBF told the court,

“I borrowed the sum of $491,743,563.39, and Gary borrowed the sum of $54,638,173.71 from Alameda [Research],” Bankman-Fried said in the filing. “All of the sums evidenced by the promissory notes were capitalized into Emergent as working capital so that it could purchase the shares in Robinhood.”

Robinhood on the other hand had also stated that they would be working with the Department of Justice to buy back the share from SBF’s company. The fourth quarter reports had been terrible for Robinhood’s Web3 wallet which recorded a fall of 24%. However, the overall net revenue of the organization increased by 5% in this quarter.

Now that Robinhood has the board’s approval, it would try its best to regain the equity from the fallen crypto giant. But the disputed ownership of the shares could become a legal battle for the trading platform to do so.

Also, Read – SEC Punishes Kraken for Selling Unregistered Securities

Bookmark (0)

Related Posts

Dogecoin (DOGE) Signals Imminent Price Resurgence, Is It Time to Buy the Dip?

Dogecoin has made a 17% recovery after testing November 2022 lows.
DOGE social sentiment is currently pessimistic. 
DOGE could soon flip $0.10

Bookmark (0)

Fed Increases Interest Rates by 25 Basis Points, Suggests Rate Hike Pause Likely

U.S. Federal Reserve Chair Jerome Powell said that the bank had decided to increase interest rates by another 0.25%.
Powell said the collapse of several banks has driven a more cautious approach, with a rate hike pause imminent.
U.S. Treasury Secretary Janet Yellen’s speech after the Fed announcement saw Bitcoin fall below $27,500.

Bookmark (0)

Shiba Inu (SHIB) Long-Term Holders Are Selling, Is a Further Price Downswing Expected? 

SHIB moved sideways in reference to its price a week ago. 
Shiba Inu long-term holders are selling.
Shiba Inu network growth is in a steep decline.

Bookmark (0)

Why is Cardano price up today?

Cardano whales are largely behind ADA’s price rally in the last week, helped by Bitcoin’s multimonth highs amid the banking crisis and Fed pivot hopes.

Bookmark (0)

Breaking SEC Sues Justin Sun for Unregistered Securities Offerings

The U.S. SEC has sued Justin Sun for offering BTT and TRX as unregistered securities.
Celebrities Austin Mahone and DeAndre Way have also been sued for promoting the tokens with disclosure.
The SEC seeks to prevent Sun from engaging in future crypto asset offerings.

Bookmark (0)

Price analysis 3/22: BTC, ETH, BNB, XRP, ADA, DOGE, MATIC, SOL, DOT, SHIB

Technical charts are beginning to suggest that BTC is at the end of its bear market cycle, and traders believe this could yield positive results for most altcoins.

Bookmark (0)

Leave a Reply

Your email address will not be published. Required fields are marked *