Bankrupt crypto lender BlockFi is suing a holding company for FTX founder Sam Bankman-Fried to recover shares in the trading platform Robinhood that were pledged as collateral before both BlockFi and FTX filed for bankruptcy protection in recent weeks, the Financial Times has reported.
The collateral that holding company Emergent Fidelity Technologies defaulted on is Bankman-Fried’s 7.6% stake in Robinhood, according to loan documents seen by the publication. The collateral, which was the obligation of FTX’s sister company Alameda Research, was pledged Nov. 9, according to BlockFi’s complaint filed Monday in New Jersey district bankruptcy court.
The agreement was inked just two days before FTX filed for bankruptcy, which has rippled throughout the crypto sphere and pushed several crypto companies, including BlockFi, to consider doing likewise.
While the complaint does not name Bankman-Fried as a defendant, it also names brokerage company ED&F Man Capital Markets, which is the custodial agent under the pledge agreement between BlockFi and Emergent.