Crypto lending platform BlockFi has filed a suit against Emergent Fidelity Technologies, the company of Sam Bankman-Fried, to recover Robinhood shares pledged as collateral. The Financial Times reports this, citing loan documents.
On 28 November BlockFi initiated bankruptcy proceedings in the United States. On the same day it filed a complaint against Emergent Fidelity Technologies, demanding the transfer to the platform of the collateral held by broker ED&F Man Capital Markets.
“Emergent breached its contractual obligations […], despite the corresponding written notice. […] BlockFi is authorised to realise its rights to the primary transfer of the collateral,” the suit states.
According to the complaint, on 9 November Emergent Fidelity Technologies entered into a payment-guarantee agreement with the platform for an unnamed borrower. The collateral used consisted of ‘ordinary shares’.
According to the FT, the matter concerns Alameda Research. Journalists also obtained loan documents indicating that the disputed assets are Robinhood securities.
In May 2022, Emergent Fidelity Technologies spent more than $648 million to acquire 56.28 million shares of the online broker (a 7.6% stake).
The publication alleges that Bankman-Fried privately tried to liquidate these securities. He allegedly continued negotiating a sale even after signing the credit agreement with BlockFi.
Earlier, Arkham reported that shortly before FTX Group filed for bankruptcy, Alameda Research moved more than $200 million in digital assets from the wallets of the US arm of the crypto exchange.
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