NEW YORK, NEW YORK - DECEMBER 22: FTX founder Sam Bankman-Fried leaves Manhattan Federal Court after his arraignment and bail hearings on December 22, 2022 in New York City. Bankman-Fried, who was indicted on December 9th and arrested 3 days later by Bahamas law enforcement at the request of U.S. prosecutors, consented to extradition to the U.S. where he is facing eight criminal counts of fraud, conspiracy and money-laundering offenses which includes making illegal political contributions. He is potentially facing life in prison if convicted. He was released on $250 million bond with the bail package requiring him to stay with his parents in California. (Photo by Michael M. Santiago/Getty Images)

Sam Bankman-Fried used Alameda Research money to buy Robinhood shares

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Sam Bankman-Fried, founder and former chief executive officer of bankrupt cryptocurrency exchange, took funds from his trading firm, Alameda Research, to buy shares of trading app Robinhood, court documents revealed on Tuesday. 

See related article: FTX asks court to keep US$450 mln Robinhood shares frozen

Fast facts

  • In an affidavit provided to the Eastern Caribbean Supreme Court, Bankman-Fried affirmed that he and FTX cofounder Gary Wang borrowed US$546 million from Alameda in April and May.
  • Bankman-Fried had previously stated his independence from Alameda’s finances, a crypto trading firm he started in 2017.
  • The funds went into Emergent Fidelity Technologies, a Bankman-Fried holding company, which acquired a 7.6% stake in Robinhood in May.
  • After Emergent Fidelity Technologies purchased the Robinhood shares, Alameda allegedly pledged Robinhood shares as collateral for a loan from crypto lender BlockFi in November. 
  • BlockFi filed a lawsuit last week against Emergent Fidelity Technologies to lay claim to the Robinhood shares. FTX creditors Yonathan Ben Shimon and Bankman-Fried have also filed court actions in attempts to gain control of the assets.
  • Last week, FTX lawyers requested that about US$430 million worth of shares remain frozen as FTX’s legal proceedings unfold.
  • New FTX CEO John J. Ray III told Congress on Dec. 13 that the exchange lost US$8 billion of customer money, and that executives of Bankman-Fried’s firms were given access to customer assets. 

See related article: FTX customers file lawsuit for priority repayment

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