• U.S. authorities are taking control of more than $460 million of assets related to the dispute between FTX and various parties.
• Those assets include Robinhood shares that various parties have attempted to lay claim to, including FTX, former FTX CEO Sam Bankman-Fried, individual investor Yonatan Ben Shimon, and lending firm BlockFi.
• The Robinhood shares were purchased last May on behalf of Bankman-Fried by his holdings company, Emergent Fidelity Technologies, for $648.3 million.
The U.S. Department of Justice (DOJ) is taking control of Robinhood shares that are under dispute by FTX-related parties, according to various reports on Jan. 4. The assets, which are worth more than $460 million, are not part of FTX’s bankruptcy estate and therefore do not need to be frozen like other FTX assets. The various parties attempting to lay claim to the disputed assets include FTX, former FTX CEO Sam Bankman-Fried, individual investor Yonatan Ben Shimon, and lending firm BlockFi.
The Robinhood shares under dispute were purchased on behalf of Bankman-Fried by his holdings company, Emergent Fidelity Technologies, last May. Emergent bought those 56.2 million shares for $648.3 million, but the shares were worth $482 million shortly after their purchase. Several parties have attempted to lay claim to the shares, with FTX and Alameda requesting a freeze on the shares in their bankruptcy proceedings and BlockFi asking for the shares to be moved to a neutral account.
At a hearing, counsel for the DOJ said that the assets are being seized in connection to the criminal case against Bankman-Fried, not at the request of FTX. It is unclear at this time what will happen to the Robinhood shares, but it appears that the DOJ is taking control of the assets to prevent any further disputes. It remains to be seen how the assets will be divided and to whom they will ultimately be awarded.