Bankrupt cryptocurrency exchange platform FTX has requested judges in the United States to block crypto lending enterprise BlockFi from receiving $450 million in Robinhood shares.
BlockFi recently took legal action against the disgraced exec’s holding firm, Emergent Fidelity Technologies, where Sam Bankman-Fried, FTX’s former chief executive, holds the purchased shares.
The lawsuit demands that the holding firm release 56 million Robinhood Markets shares recently designated as collateral for BlockFi’s bailout loans to Alameda Research.
FTX and Alameda Research filed for Chapter 11 bankruptcy on 11 November prior to resolving loans with BlockFi. The bankruptcy companies later argued its case in a court filing alleging laws protected it from debt collections.
The filing read: “In the alternative, if the Court were to determine that Alameda has failed to show that the Shares arguably are property of the bankruptcy estate, the Court should exercise its discretion to extend the automatic stay to Emergent and EDFM (the nondebtor defendants named in the BlockFi Adversary Proceeding), and ensure that all creditors—including BlockFi and the others—can participate in an orderly claims process before this Court.”
In the filing, FTX claimed that Alameda Research owned the shares and that FTX-linked firms would keep shares during ongoing investigations to resolve ownership claims.
Parties claiming ownership of the shares include FTX creditor Yonathan Ben Shimon, Sam Bankman-Fried, and BlockFi. Currently, Bankman-Fried has only $100,000 in his bank account ahead of his release while on $250 million USD bail conditions, secured by his parents’ house equity.
