HOOD Stock Alert: Is FTX About to Buy Robinhood?

  • FTX CEO Bankman-Fried is exploring a Robinhood (HOOD) acquisition.
  • Last month, the CEO disclosed a 7.6% stake in the company.
  • HOOD stock is down 49% year-to-date (YTD).
Robinhood app logo seen on smartphone on US dollar banknotes
Source: mundissima / Shutterstock.com

Robinhood (NASDAQ:HOOD) stock was momentarily halted today on news that FTX CEO Sam Bankman-Fried may be considering buying out the exchange. HOOD stock closed the day higher by 14%.

FTX operates as one of the world’s largest crypto exchanges. The company is ranked second in terms of crypto trading volume and has received more than $1.6 billion in volume for the past 24 hours. Meanwhile, Binance (BNB-USD) is in the first place spot and Coinbase (NASDAQ:COIN) is ranked third.

FTX currently allows trading in over 280 coins and has received more than 5.1 million visits in the past week. Now, it appears the exchange has its eyes set on Robinhood. Let’s get into the details.

HOOD Stock: FTX to Consider Buying Robinhood

On May 12, Bankman-Fried disclosed through a 13D form that he had purchased 56.27 million shares of HOOD stock, effectively giving him a 7.6% stake. The 13D form implies an active position, which means that the CEO also seeks to involve himself with the company’s decisions.

Bankman-Fried’s filing is similar to Elon Musk’s recent Twitter (NYSE:TWTR) 13D filing. Musk first disclosed his Twitter stake via a 13D filing, then revealed his interest in acquiring the social media platform later on.

FTX is a private company, so its financial statements are not available to the public. However, the crypto exchange has been extremely active this month, providing loans and expressing interest in several other exchanges.

Last week, FTX provided BlockFi with a $250 million revolving credit facility. BlockFi was forced to liquidate a “large client,” which many believe to be crypto hedge fund Three Arrows Capital (3AC). FTX has also expressed interest in acquiring BlockFi. According to the Wall Street Journal, the talks are ongoing.

Meanwhile, Alameda Research — which is backed by Bankman-Fried — recently announced a non-binding term sheet with Voyager (OTCMKTS:VYGVF). Alameda agreed to provide Voyager with up to $200 million in cash/USD Coin (USDC-USD) and 15,000 Bitcoin (BTC-USD).

Today, Voyager said it would use $75 million of the $200 million. It also disclosed that it had issued 3AC a notice of default. The embattled hedge fund failed to make payments on its Voyager-provided loans of $350 million in USDC and 15,250 BTC.

On the date of publication, Eddie Pan did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Eddie Pan specializes in institutional investments and insider activity. He writes for InvestorPlace’s Today’s Market team, which centers on the latest news involving popular stocks.


Article printed from InvestorPlace Media, https://investorplace.com/2022/06/hood-stock-alert-is-ftx-about-to-buy-robinhood/.

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