FTX has joined the legal fight to control $430mn of shares in retail brokerage Robinhood originally purchased by Sam Bankman-Fried, which are already the subject of three other duelling ownership claims.
The bankrupt cryptocurrency exchange formerly run by Bankman-Fried said it has a claim to own the shares the former billionaire bought in May, the company said in a court filing. The shares are currently stored in a brokerage account at ED&F Man Capital Markets, and had been held by Emergent Fidelity, an Antigua and Barbuda company that is in turn 90 per cent owned by Bankman-Fried.
FTX said the shares are “property of the . . . estates, held only nominally by Emergent”.
The shares, which represent a 7 per cent stake in Robinhood, are the subject of three other ownership claims, according to the filing.
Israeli crypto entrepreneur Yonathan Ben Shimon, a creditor and former customer of FTX, has sought to claim them in Antiguan court in repayment of money owed by FTX.
Bankrupt crypto lender BlockFi had also lodged a claim, alleging that the shares were pledged as collateral on loans it had made to Alameda Research, Bankman-Fried’s private trading firm. FTX said Bankman-Fried himself also claims the shares and has “repeatedly sought a source of payment for legal expenses”.
BlockFi’s claims stems from the events just before FTX’s collapse in early November. As rumours circulated about FTX and Alameda’s financial health, BlockFi demanded extra collateral on loans to Alameda. Caroline Ellison, Alameda chief executive, offered up the shares to shore up the trading firm’s position.
FTX asked a Delaware bankruptcy court to freeze the shares until their ownership is settled. BlockFi, Bankman-Fried and Ben Shimon did not immediately respond to request for comment.