Crypto trading giant Robinhood has successfully repurchased the stakes held by FTX founders Sam Bankman-Fried and Gary Wang through their entity Emergent Fidelity Technologies. The acquisition, valued at $605 million, marks a significant development in the ongoing legal battle surrounding the assets of Bankman-Fried.
The saga began when the United States Marshal Service seized the 55 million shares owned by Bankman-Fried and Wang as part of a criminal case against Bankman-Fried. The shares were officially transferred to the US government on January 4, following a warrant for their seizure issued on December 30, 2022. Subsequently, the US filed for their sale, leading to the recent purchase by Robinhood.
Bankman-Fried, who had vehemently opposed the FTX bankruptcy estate’s claim on these shares, argued that their seizure would cause him “irreparable” harm by hindering his ability to use the funds for his criminal defense.
Robinhood entered into an agreement with the United States Marshal Service on August 30, and the transaction was completed the following day. The company financed the purchase from its corporate cash, as indicated in the agreement’s Form 8-K filing.
This development comes after the US government confiscated approximately $700 million of Bankman-Fried’s assets in January, including $455 million worth of HOOD shares. Prosecutors suspect these shares were acquired using misappropriated funds from former FTX customers. Despite the legal wrangling, Robinhood managed to secure the stake at an average purchase price of $10.96 per share, below the current market trading value of $11.18.
