Three men and booty – The failures subsequent FTP extension then BlockFi resulted in an exceptional legal and financial dossier. The ramifications international and the complexities between the stakeholders are like this complex that even lawyers and justice need time before deciding. In that case, 56 million shares of Robinhood Markets, Inc.. I’m in balance between three entities contesting them : BlockFi failed, creditors FTX and Sam Bankman-Fried indirectly. The Justice Department is said to be seizing them 450 million dollars waiting to know who they belong to. Immersed in the intricacies of international finance…
FTX, BlockFi and Bankman-Fried: legal and financial hoax around Robinhood
To understand the details of this file sprawling, it’s worth going back a few months. At that time, FTP extension it’s a thriving business and Sam Bankman-Fried is still a financial whiz. BlockFi is a company specializing in cryptocurrency lending with guarantee. And, in fact, he grants one to a named company Emerging loyalty technologies. This entity is controlled by 90% Of SBF, then still CEO of FTX. As collateral, this company commits to a payment schedule that includes the famous 450 million dollars shares of Robin Hoodthen in his possession.
So a company owned by SBF owes BlockFi money in the form of 56 million Class A shares of Robinhood. Problem? when FTP extension goes bankrupt, justice tries to do it to recover cash where possible, including at Emergent Fidelity Technologies. But when then BlockFi also failed, its teams demanded repayment of their debts, including the famous ones collateral in Robinhood stock.
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The US Department of Justice finally makes a decision
But because nothing is ever simple, Emergent Fidelity Technologies is registered in Antigua and Barbuda. And following the collapse of FTP extensionshe herself is subject to a procedure of failure on site. So here we are at the heart from a legal knot bag with multiple procedures ongoing, requiring in-depth review. Those 56 million of shares were until now blocked with the brokerage firm ED&F Man Capital Markets at the request of Court.
Finally, it was during a hearing this week in the context of the case FTP extensiona lawyer asked the Delaware court seize these funds. Seth Shapirosenior adviser to the Department of Justice, made it clear that these actions were also on balance in the bankruptcy of Block Fi. But with the New Jersey court! The purpose is toto prevent if this jackpot is used to repay creditors in FTX or BlockFi or Emergent Fidelity Technologies. It will be up to the court to decide who gets it first.
“The seized assets will be the subject of future criminal or civil proceedings” said the lawyer himself. We will probably know more in the scheduled hearings 13 And 20 January. The justice will have a lot to do to determine who owns these 56 million shares. But there is no doubt that interested parties will have compelling arguments to back up their claims. Justice certainly has a lot to do in these cases failure where inactive users seek compensation. All under the bewildered eyes of the media and public opinion. Probably, one more step towards stricter regulation of the sector which some require.
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