Robinhood, the online platform that lets you trade stocks for free, has just pulled off a major coup. It has bought back a huge chunk of its own shares that were once owned by a notorious crypto kingpin.
The shares, worth a whopping $605.7 million, used to belong to Sam Bankman-Fried, the founder of the crypto exchange FTX. He was one of the richest people in the world until his crypto empire crumbled last year. He is now behind bars, facing charges of fraud and violating regulations.
The US government seized his Robinhood shares in January as part of its probe into his shady dealings. The US Marshal Service then agreed to sell them back to Robinhood.
Robinhood said in a filing on Friday that it snapped up more than 55 million of its own shares at $10.96 each from the US Marshal Service. The deal was approved by a US court.
This ends a bitter battle over the Robinhood stake, which was also claimed by four other parties: FTX; Bankman-Fried himself; BlockFi, a bankrupt crypto lender that said Emergent had used the shares as collateral for a loan; and an FTX creditor.
The deal is a major victory for Robinhood, which has been struggling in recent months. The company’s stock price has plummeted, and it has been forced to lay off employees. The buyback will give Robinhood a much-needed boost of confidence and help it to regain control of its own destiny.
