Sam Bankman-Fried appears to be hit by another bankruptcy report, as his holding company, Emergent Fidelity Company, files for bankruptcy. SBF and the previous FTX Trading Ltd executive Gary Wang co- established the platform.
Sam Bankman Fried’s Emergent Fidelity Technologies, an offshore corporate entity that owns 55 Million shares of Robinhood Markets, filed for bankruptcy https://t.co/AwbU79J8as
— Bloomberg Cryptocurrency (@crypto) February 3, 2023
The Antigua and Barbuda-based company filed a voluntary petition for bankruptcy protection in the United States Bankruptcy Court for the District of Delaware. Reports by a Bloomberg report, the filing came amid a fight on who should get the stock after the FTX Trading Ltd Group’s demise.
In November, the platform was already a target of a lawsuit filed by cryptocurrency lending company BlockFi. The Emergent Fidelity held approximately 55 Million shares of Robinhood Markets. Nonetheless, the Robinhood shares, valued over $590 Million, became a subject of critical interest in numerous parties. These parties include BlockFi, Bankman himself, and FTX Trading Ltd creditor Yonathan Ben Shimon.
The previous 30 days, the Department of Justice revealed that it had confiscated Robinhood shares worth $55 Million as part of the case against the bankrupt FTX Trading Ltd and its executives.
The roots of Emergent Fidelity Company Bankruptcy
Before the Justice Department seizure, Emergent Fidelity company declared ownership of the shares and the $20 Million brokerage company, Marex Financial resources Markets previously held. In the case, a declaration by one of the Joint Provisional Liquidators, Angela Barkhouse stated the platform filed for Chapter 11 protection in the same court as FTX Trading Ltd. The company desires to trail a ‘form of joint administration’ linking the two bankruptcies.
Still, Barkhouse noted,” The Joint Provisional Liquidators’ duties are to the debtor’s creditors, whoever these creditors may be.” Reports by the proceedings in the United States, numerous parties are alleging to be creditors or outright owners of Robinhood shares. Nonetheless, the liquidators affirm that chapter 11 protection is the practical way for the debtor to defend itself, the assets, and the interests of its creditors. The Antigua court has appointed individuals in charge of winding up the bankrupt entity’s affairs.
In addition, Barkhouse pointed out that SBF owns 90 percent of the platform. FTX Trading Ltd co- founder Gary Wang owns the other 10 percent of Emergent Fidelity.
SB versus the prosecutors
In the meantime, the United States prosecutors are going hard against SBF. The United States attorneys requested the judge in New York to impose more demanding bail conditions on the ex-billionaire, SBF. The proposition to the United States District Judge Lewis Kaplan erupted from the asserts that SBF would try to manipulate the witnesses or tamper with the evidence. The prosecutors likewise requested SBF not to use any message encryption app, including Signal or other encrypted calls.
These came after prosecutors disclosed email and text messages from Bankman to the present FTX Trading Ltd CEO, John Ray. The messages entailed compelling insights regarding FTX’s business operation. It’s worth noting that, SBF’s filing from January 27 shows that he aimed to contact Miller, the FTX Trading Ltd United States general counsel, to sway his criminal testimony.
Nonetheless, the previous FTX Trading Ltd CEO affirmed that he did not steal the funds. In a Substack blog post, SBF noted:
I didn’t steal funds and did not stash billions away. Nearly all my assets were and still are utilizable to backstop FTX Trading Ltd users.
The previous cryptocurrency mogul likewise addressed the Alameda Research collapse issues stating:
Alameda Research failed to hedge its market exposure sufficiently. A year ago, numerous whole lot of broad market crashes came, ‘in stocks and crypto’ leading to an 80 percent decrease in the market price of its assets.
Further, SBF argued that he had a lot more to stipulate about the failure of Alameda Research, what happened to the giant exchange FTX Trading Ltd, the Chapter 11 process, and numerous more. His statements came after pleading not guilty to fraud charges at the New York court. The charges vary from money laundering and wire fraud to campaign violations. Nonetheless, SBF’s case will commence in October.
What happened to FTX?
FTX Trading Ltd company filed for bankruptcy protection in November after users rushed to remove $6 Billion from the company in only 72 hours. Still, the giant company’s destiny shattered after the rival exchange Binance Crypto exchange deal dropped through. Reports by the SEC and CTFC, they alleged that SBF masterminded the misappropriation of customer funds.