Defunct crypto exchange FTX has filed a motion in the United States bankruptcy court for the District of Delaware, seeking its intervention in an ongoing fight over $450 million in Robinhood shares owned by an entity set up by former CEO Sam Bankman-Fried (SBF) in Antigua and Barbuda.

Three Different Stakeholders have claimed 56M Shares of Robinhood

Emergent Fidelity Technologies Ltd. is described as ‘a special-purpose holding company that appears to have no other business.’ It is also 90% owned by Sam Bankman-Fried.

The court filings add that ‘approximately 56 million shares of Robinhood Markets,

Inc.’s Class A common stock are currently frozen in a brokerage account at ED&F Man Capital Markets Inc. (EDFM) in New York City.’

These shares have since been claimed through court actions in different jurisdictions by three competing stakeholders since FTX filed for bankruptcy. They include BlockFi, Yonathan Ben Shimon and Mr Bankman-Fried.

BlockFi is seeking the Robinhood shares as a creditor of Alameda and wants to sell them to pay BlockFi’s claim. Mr Shimon is a creditor of FTX who was successfully appointed as a receiver in Antigua to obtain control of the shares and sell them under the supervision of a court in the country. Sam Bankman-Fried is seeking ownership of the Robinhood shares as a payment source for legal expenses in his ongoing legal battles.

The Robinhood Shares Should Be Frozen Until the Court Resolves the Issue

FTX added that it had instructed EDFM to freeze the shares promptly as soon as bankruptcy proceedings began in November as they belong to its estate, which has a ‘claim of ownership’ to them.

Therefore the motion requests that the shares remain frozen until the bankruptcy court resolves the issue.

‘The fact that multiple prepetition creditors of different Debtors and Mr Bankman-Fried are all seeking to obtain possession of the Robinhood Shares demonstrates that the asset should be frozen until this Court can resolve the issues in a manner that is fair to all creditors of the Debtors,’ FTX explained in the court filing.

(by John P. Njui)