• FTX sought a U.S. bankruptcy court’s help amid a battle over ownership of about $450 million worth of stock in Robinhood Markets (HOOD).
• At issue are about 56 million shares of the brokerage owned by Emergent Fidelity Technologies Ltd., a corporate entity organized in Antigua and Barbuda and 90% controlled by former FTX CEO Sam Bankman-Fried.
• FTX has asked the judge overseeing the bankruptcy case to freeze the stock while it tries to figure out how to repay all its creditors.
FTX, a crypto exchange, recently sought the help of a U.S. bankruptcy court in order to resolve a dispute involving a large amount of stock in Robinhood Markets (HOOD). According to a filing, the stock is worth around $450 million and is owned by Emergent Fidelity Technologies Ltd., a corporate entity organized in Antigua and Barbuda and 90% controlled by former FTX CEO Sam Bankman-Fried.
The dispute centers around the ownership of the 56 million shares of the brokerage. Three parties have been vying for control of the stock: BlockFi (a lender that FTX had helped prop up earlier this year), Yonathan Ben Shimon (an FTX creditor appointed as a receiver in Antigua and granted permission to sell the shares under supervision of a court there) and Bankman-Fried himself (who has legal bills).
FTX’s bankruptcy estate has asked ED&F Man Capital Markets, the brokerage where the shares are parked, to freeze the stock until the bankruptcy court can resolve the issues in a fair manner. The exchange has determined that Emergent only nominally owns the shares and that they truly belong to FTX.
The judge presiding over the bankruptcy case will now decide whether to freeze the shares of stock in order to ensure that FTX is able to pay off all of its creditors. It is hoped that the court will be able to resolve the situation in a way that is fair to all parties involved.