FTX Attempts to Freeze Robinhood Shares as Creditors Swarm to Scoop $450M in HOOD Stock
Court filings show that debtors from FTX Trading Ltd. and Alameda Research want 56 million shares of Robinhood stock frozen after multiple creditors are seeking access to the funds, and also Sam Bankman-Fried (SBF).
Court Filing Wants to ‘Enforce an Automatic Stay’ Against Claims Over FTX’s 56 Million Robinhood Shares
On Dec. 22, 2022, court documents show that debtors from FTX want to freeze 56 million Robinhood shares owned by a subsidiary crafted by SBF called Emergent Fidelity Technologies. The debtors from FTX and Alameda have said that multiple entities are seeking to claim these assets, including the now-defunct crypto lending firm Blockfi. FTX wants the court to enforce an automatic stay against claims for the 56 million Robinhood shares worth roughly $450 million.
The Class A common stock Robinhood shares are currently custodied at ED&F Man Capital Markets Inc. (EDFM) in New York City. EDFM does not dispute the ownership of the $450 million shares of Robinhood stock. The court filings say that not only is BlockFi Inc. attempting to gain access to the shares, but Yonathan Ben Shimon and SBF are also looking to obtain the stocks. FTX insists to the court that the debtors have “at least a ‘colorable’ claim to ownership of the Robinhood Shares.”
“The fact that multiple prepetition creditors of different Debtors and Mr. Bankman-Fried are all seeking to obtain possession of the Robinhood Shares demonstrates that the asset should be frozen until this Court can resolve the issues in a manner that is fair to all creditors of the Debtors,” the FTX court filing submitted on Thursday evening details. “The full evidentiary record, once completely developed, will show the Robinhood Shares are conclusively estate property,” FTX added.
The filing shows that Alameda’s ex-CEO Caroline Ellison allegedly almost sold the Robinhood shares in an over-the-counter (OTC) deal. Further, Ellison later pledged the shares to Blockfi in order to commence a deal which was an attempt to save the troubled crypto lender from defaulting and filing for bankruptcy. The court document shows that Blockfi’s CEO Zac Prince “agreed to Ms. Ellison’s offer to pledge the Robinhood Shares and certain other Alameda assets as security for Alameda’s debts.”
What do you think about the court filings that show FTX wants to freeze $450 million worth of Robinhood shares? Let us know what you think about this subject in the comments section below.