Robinhood Board Approves Buyback Of Sam Bankman-Fried's 55 Million Shares
![Naga](https://en.ethereumworldnews.com/wp-content/uploads/2022/12/cropped-IMG-6187-1-50x50.jpg"></p><p>Summary:</p><ul><li>Robinhood plans to buy back nearly $600 million worth of shares owned by the FTX Founder.</li><li>Sam Bankman-Fried scooped the shares back in May 2022 through a holding company – Emergent Fidelity Technologies.</li><li>The 55 million shares have been in contention since FTX filed bankruptcy last year and were later seized by the U.S. Department of Justice. </li></ul><div class=)
The board at Robinhood approved a massive back buy for some 55 million shares acquired by former crypto mogul and FTX Founder Sam Bankman-Fried.
Executives disclosed the action plan to repurchase the shares in a Q4 financial report released on Wednesday, February 8, 2023. The company’s CFO Jason Warnick noted that approval from the board signals confidence in Robinhood’s business despite suffering $1 billion in net losses in 2022.
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Crypto transactions on the Menlo Park-based stock broker dipped to $39 million in Q4 2022, a 39% drop from Q3. Net revenues in Q4 did grow to $380 million, recording a 5% increase in the later stages of last year. Robinhood had hoped that launching its Web3 Wallet tool would shore up the balance sheet and rake in more cash from the digital asset ecosystem.
SBF Leveraged Alameda Loans To Buy Robinhood Stake
The FTX Founder confirmed that loans from Alamada Research funded an investment in Robinhood worth $600 million at the time, per filings made at an Antiguan court in December. Sam Bankman-Fried said both he and former FTX CTO Gary Wang agreed to deploy capital from FTX’s sister firm Alameda toward the huge stock buy in May.
Both former execs of the bankrupt crypto exchange acquired a 7.6% stake in the stockbroker through Emergent Fidelity Technologies, a holding company solely controlled by SBF and Wang.
Justice Department Seized SBF’s Robinhood Shares
Robinhood could face an uphill battle in buying back the shares as the U.S. Department of Justice seized SBF’s stake in the stockbroker earlier in January. At current prices, the shares are worth around $570 million, slightly lower than the $600 million valuation they held in May.
The seizure came weeks after entities like BlockFi, FTX, and individual creditors tussled over the shares. CFO Warnick told CNBC that his company was liaising with the DOJ on how to legally claim the shares following approval from the board.
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