Robinhood shares surge more than 30% after Sam Bankman-Fried buys 7.6% stake

Sam Bankman-Fried, CEO of cryptocurrency exchange FTX, has acquired 7.6% of Robinhood, according to a filing Thursday with the Securities and Exchange Commission.

Shares of the invested company jumped 36% at some point in an extended trading period before plummeting. It was last up to about 26%.

In regular trading on Thursday, the stock hit an all-time low. Robinhood closed the session at $8.56, about 77% off its IPO price last July.

According to the document, Emergent Fidelity Technologies has acquired a $648 million stake in Robinhood. It says Bankman Fried is the sole director and majority owner.

The document goes on to say that Bankman-Fried acquired the shares because they believed they “represented an attractive investment”. “The reporting persons intend to hold the shares as an investment, and currently have no intention of taking any action toward changing or affecting the issuer’s control,” the report states. Although the filing also stated that it may “from time to time engage in discussions” with management.

Robinhood’s communications team said in a tweet Thursday evening in response to the news of the investment.

Bankman-Fried currently has no intention of taking further action but at some point if conditions change, it may review “options to enhance shareholder value through, among other things, various strategic alternatives, operational or management initiatives,” according to the document. She also says he can get additional shares.

FTX, where Bankman-Fried is CEO, is one of the largest cryptocurrency exchanges in the world and offers derivative products to the most sophisticated traders as well as spot trading. FTX has become a competitor to Coinbase and Binance, although it does not offer its services in the US

Robinhood got its start in allowing individual investors to invest in stocks, but it took a hit when it launched its cryptocurrency trading platform in 2018. Since then, cryptocurrency trading has become important to the company’s bottom line. In the fall, Robinhood revealed it had tested a crypto wallet and said its waiting list had crossed one million customers.