• According to the filing with the US Securities and Exchange Commission (SEC), SBF purchased a 7.6 percent stake in Robinhood in May 2022. 
•  Robinhood has stated that it would try to buy it back.

In an affidavit, Ex-FTX CEO Sam Bankman-Fried and ex-FTX CTO Gary Wang formed a new company, Emergent Fidelity Technologies, to acquire shares in Robinhood Markets Inc, totaling $546.4 million. According to a court document filed in December, they funded this operation by taking loans from Alameda Research—Bankman-Fried’s trading firm. 

I borrowed the sum of $491,743,563.39, and Gary borrowed the sum of $54,638,173.71 from Alameda [Research]. 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.

According to the filing with the US Securities and Exchange Commission (SEC), SBF purchased a 7.6 percent stake in Robinhood in May 2022. Interestingly, BlockFi claims SBF used its stake in Robinhood as collateral to help it sail through its liquidity issues. 

While this stake has been a contesting factor between the two parties, Robinhood has stated that it would try to buy it back. On a teleconference with investors and analysts, the company CEO Vlad Tenev stated that the purchase would eradicate distractions for shareholders. Speaking on this, Tenev claimed that the decision is very advanced as the company’s board of directors has already approved the purchase of around 55 million shares. He, however, did not give any hint on when the purchase would be completed. 

Since there isn’t much precedent for situations like these, I can’t predict how long this will take.

SBF strongly appeals for the possession of its stake 

In a press statement, the U.S. Justice Department announced that they have taken custody of those shares worth $450 million at the time. Lawyers of SBF have also filed a motion to keep possession of the equities. According to them, this will be needed to pay for the criminal offense, hence, the debtors of FTX’s request to secure it should be denied. 

They (Debtors) have failed to carry their heavy burden of demonstrating that they are entitled to this form of relief.

Robinhood international market expansion

Robinhood has been active in the crypto winter period with its digital wallet built around self-custody set to be released. According to them, there could be more than a million users coming on board. This is said to be a huge effort in their expansion into the international market. 

Robinhood CFO Jason Warnick said:

We continue to think that crypto is here to stay. We’re continuing to invest in this space and are really optimistic.

Robinhood equally suffered its share of the huge decline in the crypto winter. It saw the total amount of assets under custody on the platform falling to $62 billion from $98 billion last year. This is a decline for the fourth consecutive quarter. In addition, the value of cryptocurrencies held on its platform reduced to $8 billion from $22 billion, representing a 62 percent decline. 

The crypto market has seen a considerable surge with Bitcoin rising by 31.58 percent in the last 30 days.