Robinhood Agrees $600 Million Buyback of Seized Sam Bankman-Fried HOOD Stake From US Marshal Service
In an unprecedented move, US-based commission-free stock trading platform Robinhood has agreed to a $600 million buyback of the seized Sam Bankman-Fried (SBF) HOOD shares from the US Marshals Service.
SBF had been arrested in December of 2020 on charges related to operating a Bitcoin trading business without the applicable registration and licensing required by the CFTC. As a result, the US Marshals seized his shares of the HOOD development company and digital token, valued at around $700 million.
Robinhood, which purchased around 7.8 million HOOD tokens in June of 2020, has agreed to pay $600 million for the HOOD tokens seized by government, which represent just under a quarter of its total holdings. The buyback, the first of its kind by a major exchange, has been seen as a rare show of support from Robinhood for its customers and those of SBF by ensuring that they secure their tokens without the waiting period unforeseen seizures can often create.
The buyback announcement has not only made waves in the crypto space but it has also drawn attention to the growing trend of increased regulation of the digital asset industry. Though the buyback has gone a long way in restoring investor faith in the stability of the crypto space, it remains to be seen what strategies will be adopted to ensure robust governance and continued growth of the industry in the future.