BlockFi Continues Dispute Appeal 55 Million Robinhood Shares

Key Points:

• Crypto lender BlockFi filed a motion on Thursday to dismiss Emergent Fidelity Technologies’ bankruptcy case. SBF owns 90% of this Antigua-based shell corporation.
• The insolvent crypto lender claims that the Emergent Fidelity lawsuit is “futile.”
• According to the company, the action was brought “solely” to further the interests of the Antiguan liquidators, who have already earned over $1.7 million in fees.

BlockFi, an crypto lending company that has filed for bankruptcy, asked the court to dismiss the bankruptcy request of Emergent Fidelity Technologies because the battle for about $600 million in assets owned by Sam Bankman-Fried (SBF) is becoming more and more complicated.

Emergent Fidelity, a shell company in Antigua 90% owned by SBF, owns 56 million shares of Robinhood and some cash.

Legal disputes between FTX, BlockFi, the Department of Justice, and Robinhood’s board of directors surround the assets, which BlockFi believes Emergent Fidelity’s Antigua liquidators have complicated by filing for Chapter 11 bankruptcy protection in the United States.

BlockFi believes the bankruptcy filing was filed to advance the interests of Antigua liquidators, who have received at least $1.7 million in fees, and BlockFi has taken legal action to secure the shares. BlockFi said in the filing:

“Neither law nor equity require the doing of a futile act. But this bankruptcy case asks the Court to do just that—to “reorganize” an empty shell. Emergent has no employees, no income, and no business; its sole assets were shares in Robinhood Markets Inc. (the “Shares”) worth hundreds of millions of dollars.”

BlockFi has filed a lawsuit to gain access to the equities, which it claims were used as collateral for a loan made on November 9. As part of its investigation into fraud allegations against SBF and Gary Wang, who owns the final 10% of Emergent, the Department of Justice confiscated the assets in January.

Previously, the crypto lending company announced the establishment of a website called Kroll, its complaints agent, to receive complaints from users.

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Harold

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