Robinhood Markets has repurchased $605 million worth of shares that previously belonged to Sam Bankman-Fried, the disgraced crypto mogul, capping a contentious ownership dispute.
Robinhood, which runs the popular commission-free stock trading app, said in regulatory filing Friday that it bought more than 55 million of its own shares that were seized by the Justice Department in January. The shares were originally acquired by Emergent Fidelity Technologies, a holding company majority-owned by Bankman-Fried that went bankrupt shortly after trading platform FTX and the rest of his sprawling crypto empire collapsed last fall.
In the maelstrom that followed FTX's downfall, the Robinhood stake was contested by four separate entities: FTX; Bankman-Fried himself; the bankrupt crypto lender BlockFi, which argued that Emergent had pledged the shares to it as collateral on a loan; and an individual FTX creditor.
Ultimately, Robinhood repurchased the stake from the United States Marshal Service, which had custody of the shares after they were seized.
Robinhood shares jumped more than 3.5% Friday.
"We are happy to have completed the purchase of these shares and look forward to executing on our growth plans on behalf of our customers and shareholders," Jason Warnick, Robinhood's chief financial officer, said in a statement.
US prosecutors accused Bankman-Fried, 31, of orchestrating a multi-billion-dollar fraud in which he lied to investors and illegally siphoned funds from FTX customers. He has pleaded not guilty to all the charges against him and is scheduled for trial in October.
