NOT WITHOUT A FIGHT

BlockFi Sues FTX’s Sam Bankman-Fried Over Robinhood Shares

The lawsuit comes just hours after the cryptocurrency lender filed for bankruptcy protection after a liquidity crunch brought on by the collapse of FTX.

Hours after filing for bankruptcy protection, cryptocurrency lender BlockFi sued a holding company belonging to Sam Bankman-Fried in an attempt to recover shares in Robinhood that the disgraced FTX founder allegedly pledged as collateral just three weeks ago. BlockFi’s Monday lawsuit targeted Bankman-Fried’s Emergent Fidelity Technologies, which it said had defaulted on the terms of a Nov. 9 pledge agreement. The collateral in question is Bankman-Fried’s 7.6 percent stake in Robinhood, the investment and trading platform, which he acquired earlier this year, according to the Financial Times. Earlier on Monday, BlockFi declared bankruptcy, citing a “severe liquidity crunch” brought on by the spectacular $32-billion collapse of FTX, which crashed and burned after the revelation of the use of billions of dollars in customer money to make undisclosed loans to Alameda Research, Bankman-Fried’s digital-currency firm. BlockFi’s Monday case claims that, last month, it had entered into an agreement with Emergent to guarantee the obligations of an unnamed borrower with stock as security. Correspondence attached to the complaint identifies the borrower as Alameda, the FT reported.