- The US Departure of Justice (DoJ) has either seized or is in motion to seize shares of Robinhood shares connected to SBF
- This seizure had causing multiple parties to stake their claims on FTX’s assets
Samuel Bankman-Fried investment cobweb in 2022, where he buys stakes in many crypto platforms and exchanges. Robinhood was one of his major stakes, where he bears 7.6% of the company stakes—which is $648 million, & SBF alone secured a total of 56 million shares worth roughly $465 million in the deal, using funds borrowed from Alameda Research.
On 4 January 2023, Reuters reported that US Attorney Seth Shapiro had informed the U.S. Bankruptcy judge John Dorsey, overseeing the FTX bankruptcy case, that they were seizing 56 million shares of Robinhood—$465 million. This occurred after the judge ordered SBF not to access or transfer any crypto asset from FTX or Alameda Research.
Shapiro added that prosecutors had seized U.S. bank accounts tied to FTX’s Bahamas-based business—FTX Digital Markets. Court records show the accounts at Silver Gate Bank and Farmington State Bank, which does business as moonstone bank, held about $143 million.
Now, after the collapse of FTX—US authorities seize FTX’s Robinhood shares, causing multiple parties to stake their claims on FTX’s assets. FTX, BlockFi and now FTX creditor Yonathan Ben claimed staked.
Robinhood’s Shares and SBF connection
BlockiFi sued SBF because he used Robinhood’s shares as collateral. At the time of purchasing shares, SBF borrowed funds from Almeda Research and after the purchase, Almeda pleaded those shares as collateral to take a loan from blockFi.
Just before the collapse of FTX, SBF pleaded with those shares again to get another loan. That means he broke the agreement and defaulted on the collateral. Consequently, blockFi gave an ultimatum to SBF to surrender collateral to them
The US authorities decided to seize or in the process of seizing, $465 million worth of the exchange’s shares, linked to FTX.
James Bromley, an attorney for FTX, told Dorsey that none of the seizure assets are currently in the direct control of FTX in Chapter 11.
In November, SBF denied moving funds from Alameda research, saying that he no longer had access to the wallets since stepping down as CEO.
On 3 January 2023, SBF pleaded “not guilty” to all eight charges, including wire fraud and money laundering—connected with the FTX collapse, which carries a total of 115 years of prison for him if he is convicted.
Since December, from a court order—the so-called “crypto king” has stayed under house arrest at his parent’s residence in Palo Alto, California. And required to wear an electronic monitoring bracelet on his ankle. He needs to show up for court in New york—his trial date has been set for 2 October 2023.
The two executives of the FTX, Gary Wang, co-founder of FTX and Caroline Ellison, former CEO of Alameda Research, pleaded guilty to federal fraud charges for their role in the collapse of crypto exchange FTX.
Now it willl be interesting to see as to who gets to acquire control over them, BlockFi, SBF, or someone else.