In the newest update, Sam Bankman-Fried (SBF), former CEO of a bankrupt crypto exchange FTX, wants the court to prohibit debtors’ access to his Robinhood shares. A study presented by US prosecutors showed the Robinhood shares are worth $450 million.
SBF has been under house arrest since his capture by the Royal Bahamas Police Force after the U.S. brought criminal charges against him. All events took place in December 2022, weeks after the crash of his crypto exchange, leaving many with multiple losses. In the newest update, Sam Bankman-Fried (SBF), former CEO of a bankrupt crypto exchange FTX, wants the court to prohibit debtors’ access to his Robinhood shares. A study presented by US prosecutors showed the Robinhood shares are worth $450 million.
SBF has been under house arrest since his capture by the Royal Bahamas Police Force after the U.S. brought criminal charges against him. All events took place in December 2022, weeks after the crash of his crypto exchange, leaving many with multiple losses.
FTX Exchange and Alameda Research are now in the hands of liquidators assigned by the court. The liquidators are looking for any viable assets to reimburse FTX debtors.
In an earlier court hearing, a US Department of Justice prosecutor declared their desire to seize SBF’s’ shares worth $450 million. Meanwhile, the next hearing will reveal what the Department of Justice will do with the Robinhood shares.
Sam Bankman-Fried filed a motion to the United States Bankruptcy Court in Delaware contesting the enforcement of control over his shares. In the court brief, he argues the Robinhood shares have nothing to do with any FTX-affiliated entities.
In a Thursday filing, SBF’s’ lawyers argued that their client required money to cover his legal bills and expenditures.
Meanwhile, the collapse is having a cascading effect on several companies that had significant exposure to the exchange that has since gone bankrupt. Genesis Trading, for instance, is likewise dealing with the fallout of the FTX problem. The cryptocurrency loan company BlockFi has also declared bankruptcy and is attempting to repossess the Robinhood holdings.
Using the Robinhood shares as security, BlockFi claimed Sam Bankman-Fried had provided a $600 million loan to save the company. This $240 million bailout for BlockFi was agreed upon and signed by the company’s former CEO in July of 2022. As a result of its heavy reliance on FTX, BlockFi was forced to declare bankruptcy when the crisis hit.
Customers of FTX exchange had launched a class action lawsuit against Sam Bankman-Fried and FTX prior to BlockFi’s collapse. A class action lawsuit was filed claiming the plaintiffs are entitled to FTX’s residual assets. A class action lawsuit is a type of lawsuit in which one party sues another on behalf of a larger group or parties who are not personally involved in the case.
Notably, in its bankruptcy petition, troubled cryptocurrency exchange FTX disclosed that it has more than a million creditors. According to published reports, law enforcement and regulatory bodies are looking into FTX and Sam Bankman-Fried. Tom Brady is just one famous name among the many that invested in the doomed FTX company and suffered big losses.
Coincidentally, the native token of the FTX exchange, FTT, has dropped in value by almost 75% since the collapse of the FTX and is now trading at $0.916. The price of FTT has decreased by 2.45% during the past day.
