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Bankrupt Crypto Lender BlockFi Sues Bankman-Fried for Robinhood Shares, FT Reports

Bankman-Fried, through a holding company, pledged his stake in Robinhood as collateral for a loan.

By Greg Ahlstrand
AccessTimeIconNov 29, 2022 at 3:36 a.m. UTC
Updated May 9, 2023 at 4:03 a.m. UTC
BlockFi CEO Zac Prince at Consensus 2019 in New York (CoinDesk)
BlockFi CEO Zac Prince at Consensus 2019 in New York (CoinDesk)
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Cryptocurrency lender BlockFi, which filed for Chapter 11 bankruptcy protection on Monday, on the same day sued FTX founder Sam Bankman-Fried's Emergent Fidelity Technologies holding company for Robinhood Markets (HOOD) shares held by the company and pledged to BlockFi as collateral, the Financial Times reported, citing loan documents it had seen.

Read more: BlockFi Files for Bankruptcy as FTX Contagion Spreads

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    • The complaint says BlockFi and Emergent Fidelity Technologies entered an agreement on Nov. 9 to guarantee payment by an unnamed borrower, pledging an unnamed common stock as collateral. The FT, citing legal correspondence, reported that the borrower was Bankman-Fried's Alameda Research.

    Bankman-Fried, trying to raise money before FTX's collapse, was still trying to sell his Robinhood shares after entering into the collateral agreement with BlockFi, the FT cited two people familiar with the matter as saying.

    Read more: FTX CEO Sam Bankman-Fried Buys 7.6% Stake in Robinhood

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    CoinDesk is an award-winning media outlet that covers the cryptocurrency industry. Its journalists abide by a strict set of editorial policies. In November 2023, CoinDesk was acquired by the Bullish group, owner of Bullish, a regulated, digital assets exchange. The Bullish group is majority-owned by Block.one; both companies have interests in a variety of blockchain and digital asset businesses and significant holdings of digital assets, including bitcoin. CoinDesk operates as an independent subsidiary with an editorial committee to protect journalistic independence. CoinDesk employees, including journalists, may receive options in the Bullish group as part of their compensation.

    Greg Ahlstrand
    Greg Ahlstrand

    Greg Ahlstrand was previously CoinDesk's Asia News Editor. Greg has no significant crypto holdings.

    Follow @GregAhl on Twitter

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