FTX CEO Sam Bankman-Fried Buys 7.6% Stake in Robinhood

A filing with the U.S. Securities and Exchange Commission has it that
Sam Bankman-Fried, CEO of crypto exchange FTX, has bought a substantial 7.6% stake in stock and crypto trading app Robinhood.

News of the purchase sent Robinhood shares soaring by over 30% in after-hours trading.

According to the SEC filing, Bankman-Fried bought over 56 million shares of Robinhood via a firm called Emergent Fidelity Technologies.

The stake is currently worth about $600 million.

Robinhood had hit an all-time-low of $7.71 just hours before news of Bankman-Fried’s investment in the company.

The stock has dropped steadily since hitting $55 shortly after its IPO last July.

Since its IPO, Robinhood’s fortunes had been soured. Recently, the company saw an 18% decline in revenue for Q1 2022. Three weeks ago, it laid off 9% of its workforce, citing a global downturn in casual-investment activity as the reason for slowing growth.

Yet, the same quarterly report revealed that in crypto division, Robinhood was actually experiencing an upswing.

While investment in traditional assets faltered, the app saw a 13% increase in cryptocurrency trading revenue in Q1.

Robinhood has been steadily expanding its crypto offerings: Last month, it added Solana, Shiba Inu, Polygon, and Compound to the platform.

Bankman-Fried stated that he does not have any intention to change or influence Robinhood’s direction, and that he purchased his stake in the company because it “represents an attractive investment.”