Everyone Wants SBF's $450M in Robinhood Shares

John J. Ray III, the bankruptcy specialist serving as FTX's CEO, went to court in Delaware to stake his company's claim over Sam Bankman-Fried's (SBF) shares in trading app Robinhood–worth about $450M today.

In May 2022, SBF purchased about 56M Robinhood Class A common stock shares through one of his special-purpose holding companies, Emergent Fidelity Technologies. The holding company, based in Antigua and Barbuda, transferred the shares to a brokerage in New York after the FTX collapse. When FTX filed for bankruptcy last month, the shares were frozen. FTX is arguing that the shares should remain frozen until the defunct exchange can use them to pay back the people it ripped off.

FTX is actually the fourth entity to officially claim it deserves the Robinhood shares.

At the start, when the FTX collapse was still just a tweet-fueled bank run on the FTX exchange, SBF allegedly promised his Robinhood shares as collateral for two separate loans–one to bankrupt CeFi lender BlockFi and the other to Matchpool. Matchpool leadership has permission in Antigua to sell the shares if they can get them there, but unfortunately for Matchpool the shares are parked in New York. For what it's worth, it seems like FTX is mostly worried that BlockFi will get the shares.

Coming in third is SBF, who actually bought the Robinhood shares. FTX is arguing that the shell company that owns the shares isn't “separate enough” from FTX, and I can kind of see their argument. SBF tried to use these Robinhood shares to save FTX during the collapse, and it seems like SBF may have bought the shares with money he stole from FTX's customers–where else would he get the money, right?

It's not clear right now who is going to end up with the Robinhood shares, and unless Cathie Wood wants in I don't see how they can sell the shares without doing serious damage to Robinhood's stock price.