Sam Bankman-fried purchased a 7.6% stake in Robinhood and the news of the purchase sent the shares up to 30% only a few hours after hitting an all-time low so let’s read more today in our latest cryptocurrency news.
Sam Bankman-Fried purchased stakes in Robinhood according to a filing with the US SEC today. The news of the purchase sent the Robinhood shares soaring b over 30% in after-hours trading and the stock came back down a bit later to $10.72. as per the SEC filing, SBF bought over 56 million shares of Robinhood via a company called Emergent Fidelity Technologies and the stake is worth around $600 million. The investment came at a time when Robinhood’s fortunes and revenues declined and only hours before the purchase, the shares hit an all-time low of $7.71.
The stock dropped steadily after hitting $55 after its IPO last July so since then, the company revenues were on a downswing as well. The company saw an 18% decline in revenue for Q1 2022 while three weeks ago, it laid off 9% of the workforce due to the global downturn in casual investment activity as the main reason for slowing growth.
The same report also revealed that in one division, Robinhood was experiencing an upswing in crypto. While the investment in traditional assets faltered, the app saw a 13% increase in crypto trading revenue and Robinhood was expanding the offerings so last month it added Solana, SHIB, Compound, and Polygon. In the SEC filing, bankman Fried stated that he doesn’t have intentions to change or to influence the direction of the platform and that he purchased a stake in the company because it represents quite an attractive investment. Robinhood’s communication team picked up on the quote and tweeted:
“Of course we think it is an attractive investment too.”
As recently reported, The Coinbase executives don’t talk about the Robinhood partnership and on the earnings call, the company made clear it aims to stay the course in building for the long term. Coinbase showed disappointing results and caused the stock to crash but the top executives suggested during the earnings call that the company has no major moves planned like the merging with Robinhood or its acquisition. COO Emilie Choi gave a short opinion on the idea of a tie-up with the trading app whcih is a topic that was the most upvoted item on the discussion board for the investors that coinbase users inform the investor calls.
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