Robinhood stock jumped 22% on Friday, a day after the CEO of a major crypto exchange bought a stake in a retail investment app.
Emergent Fidelity Technologies acquired a 7.6% stake in Robinhood worth $648 million earlier this month, according to a filing with the Securities and Exchange Commission. The document also revealed that Sam Bankman-Fried, who heads the Bahamas-based crypto firm FTX, is the sole director and majority owner of Emergent. This share makes Emergent Robinhood the third largest shareholder, according to FactSet.
Robinhood shares closed at $8.56 on Thursday, the day the application was filed. This was about 77% below the company’s IPO price in July.
Bankman-Fried purchased the shares because they “represent an attractive investment,” according to the statement, which also said he “intends to hold the shares as an investment” and “does not intend to take any action to change or influence management.” . Issuer”.
However, he may “from time to time enter into discussions” with management.
“Of course we think it’s also an attractive investment,” Robinhood’s public relations team said in a tweet Thursday night in response to investment news.
According to the document, Bankman-Fried may also consider “options to increase shareholder value through, among other things, various strategic alternatives or operational or management initiatives.” He also said that he may purchase additional shares.
FTX is one of the largest crypto exchanges in the world. It offers derivatives for more experienced traders as well as spot trading and has become a competitor to big names like Coinbase and Binance. It offers service in the United States through a separate entity, FTX US.
Although Robinhood got its start trading stocks, it became a huge success when it launched its cryptocurrency trading platform in 2018. Since then, cryptocurrency trading has become an important part of the company’s profits. In the fall, Robinhood revealed that it was testing a crypto wallet and reported that the waiting list had exceeded one million customers.