BlockFi Sues FTX CEO Sam Bankman-Fried Over Pledged Robinhood Shares

a crypto lending firm, is suing FTX CEO Sam Bankman-Fried to obtain shares of Robinhood that were allegedly pledged to the company as collateral earlier this month. The filing came just hours after BlockFi filed for bankruptcy, citing “a liquidity crisis” caused by exposure to Bankman-Fried’s FTX exchange and its sister hedge fund Alameda research.

lender’s complaint alleges that Bankman-Fried’s investment vehicle Emergent Fidelity Technologies, in partnership with ED&F Man, a London-based financial services firm, “has custody of the collateral that belongs to BlockFi.” These assets were pledged to BlockFi under the terms of an agreement made on November 9, according to the filing.

first bought his 7.6% stake in consumer trading app Robinhood in May 2022, according to a filing with the U.S. Securities and Exchange Commission. The filing, lodged in the same New Jersey court BlockFi opted for bankruptcy protection, goes on to claim that Bankman-Fried’s vehicle has “defaulted on its obligations under the pledge agreement” and that it “ failed to satisfy its obligations thereunder despite written notice of default and acceleration.”

bankrupt lender said it will now look to “enforce the terms of a pledge agreement and to recover collateral that is property of these bankruptcy estates.” The Financial Times also alleges, citing unnamed and unconfirmed sources, that Bankman-Fried had been listing his stake in Robinhood among his list of assets, as he undertook last-ditch efforts earlier this month to raise money from investors to attempt to save FTX.

By Evey Lovelace

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