FTX head acquired a $648 million stake in Robinhood

The stock price of the online broker increased by more than 30%

13.05.2022 - 13:15

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What’s new? Emergent Fidelity Technologies, owned by the head of FTX crypto exchange Sam Bankman-Fried, bought a 7,6% stake in the online broker Robinhood. According to a report filed with the US Securities and Exchange Commission (SEC) on May 12, the total value of the stake was $648,29 million. After that, Robinhood’s stock price rose by more than 30%. As of May 13, 16:15 Moscow time, HOOD’s shares are trading at $8,56, according to Investing.com.

Report to the SEC

What else is known about the deal? In the document, Bankman-Fried noted that he does not intend to influence Robinhood’s operations at the moment. He considers the deal an “attractive investment” and plans to keep the shares in his portfolio. However, the FTX chief may consider “options for enhancing stockholder value through, among other things, various strategic alternatives or operational or management initiatives,” the paper said. In addition, Bankman-Fried may acquire additional shares.

What is known about Emergent Fidelity Technologies? It is an investment company registered in Antigua and Barbuda. Sam Bankman-Fried is its sole director and majority owner.

What events happened before? In March, the FTX crypto exchange received a license in Dubai. According to Bankman-Fried, FTX aims to offer sophisticated crypto derivatives products with a centralized clearing of counterparties in institutional markets. He added that the previously established FTX Europe subsidiary would be a key participant in the Dubai World Trade Center (DWTC).

On May 6, Robinhood added cryptocurrency funds of the digital asset manager, Grayscale Investments, based on bitcoin and Ethereum to its platform. Users of the online broker can trade Grayscale’s Bitcoin Trust (GBTC) and Ethereum Trust (ETHE) stocks directly through the app. GBTC and ETHE units offer investors access to cryptocurrency without having to buy or store digital assets directly.

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