11-29-2022 icon

BlockFi files suit against SBF’s firm over holdings in Robinhood

By Lucy Adegbe

Recently insolvent digital currency loan protocol BlockFi has charged Sam Bankman-Fried’s investment firm Emergent Fidelity Technologies, demanding its portion of holdings in Robinhood that was initially agreed upon as indemnity in the earlier days of November. 

On Monday, the bankrupt loan protocol submitted the suit in the US insolvency high court of New Jersey, following BlockFi’s signup for chapter 11 liquidation.

According to the filing, BlockFi requests that Emergent Fidelity Technologies fulfill its end of the bargain to a settlement schedule that it reportedly declined to settle. 

BlockFi tags this indemnity as “including certain shares of common stock.”

Former FTX chair Sam Bankman-Fried purchased a 7.6% portion of holdings in the online stockbroker company Robinhood, gaining an estimated $648 million in holdings through its investment platform Emergent Fidelity Technologies.

BlockFi is the most recent among major crypto companies to declare insolvency due to exposure to failed digital currency trading protocol FTX. 

The virtual lending firm formerly refuted claims that a significant portion of its properties was under the custody of FTX, although it admitted to “significant exposure” to FTX.

In its insolvency proceedings, BlockFi noted that it owns finances estimated to be in the range of $1 billion to $10 billion. It debt also amounts to similar estimates, combined with its 100,000 lenders.