[HN Gopher] Robinhood to buy back Bankman-Fried's stake for $605...
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Robinhood to buy back Bankman-Fried's stake for $605M from U.S.
government
Author : mfiguiere
Score : 55 points
Date : 2023-09-01 16:20 UTC (6 hours ago)
(HTM) web link (www.cnbc.com)
(TXT) w3m dump (www.cnbc.com)
| troupe wrote:
| Does anyone know how much Bankman-Fried's company paid for those
| shares? Does this represent a good deal for Robinhood, or are
| they paying a premium to get them back?
| ksherlock wrote:
| The SEC filing where SBF disclosed his stake was May 2, 2022.
| There was a noticeable HOOD volume increase on April 27-28-29
| so let's assume that's when they were purchased. The range for
| that time period was $9.00-10.79/share.
|
| However, that was on the open market so Robin Hood's proceeds
| were $0.00.
|
| The robin hood IPO was at $38/share which is more than $10.96 a
| share so in that sense it's a good deal for them.
|
| https://www.sec.gov/Archives/edgar/data/1783879/000114036122...
| exabrial wrote:
| Are people actually using Robinhood for anything serious?
|
| Personally, if something goes wrong with my money, there needs to
| be someone on a phone line somewhere to call. I don't understand
| why anyone would settle for _nonexistant_ customer service.
| xnx wrote:
| Shares were sold at $10.96, a ~2% discount to the current $11.18
| share price. Was the US not able to sell these shares on the open
| market because it would tank the price and value of the shares?
|
| Edit: Facepalm. 2% not 20%
| pgwhalen wrote:
| Never mind the incorrect math, you have a timing problem: you
| looked at the price this morning after reading the news about
| it, but the deal was effectively done overnight. Yesterday's
| closing price for the stock was $10.89.
| Frummy wrote:
| That's 2%
| christiangenco wrote:
| `(11.18-10.96)/11.18=0.0196779964`
|
| That checks out. A 20% discount would've been
| `11.18-0.2*11.18=8.944`.
| jmartrican wrote:
| Does the US gov make a profit on the deal? Does some or all of
| the proceeds go to pay back victims?
| belltaco wrote:
| The govt didn't buy the shares, they seized them. So it's all
| technically profit but they probably want to reimburse the
| scammed folks.
| benjaminwootton wrote:
| As of today, SBF hasn't been found guilty in any court of
| law.
|
| Are the government typically allowed to seize and sell your
| assets and possibly redistribute the proceeds before you've
| even been to court?
|
| What if he needed those funds for his legal defence?
| [deleted]
| fatfingerd wrote:
| AFAICT he pledged them to BlockFi to try to stop a margin
| call, and they went bankrupt, so its just a question of
| which bankruptcy claims they are for.
| edmundsauto wrote:
| > Are the government typically allowed to seize and sell
| your assets and possibly redistribute the proceeds before
| you've even been to court?
|
| Yes, asset seizure is the norm for law enforcement in
| America.
|
| > What if he needed those funds for his legal defence?
|
| The money is in a limbo state, as it might be proceeds from
| crimes. The justice system doesn't want you using proceeds
| from crimes in any way, shape or form.
| JumpCrisscross wrote:
| > _asset seizure is the norm for law enforcement in
| America_
|
| Freeze and seizure, sure. Pre-trial disposal, no. In this
| case, the headline is being loose in that these aren't
| Bankman-Fried the natural person's shares, they're a
| bankrupt entity's. Selling a bankrupt entity's stuff is
| par for the course.
| freejazz wrote:
| This has nothing to do with his criminal trial, this has to
| do with his company filing for bankruptcy. If he didn't
| want the gov't to auction of his companies assets in order
| to satisfy his creditors... then he shouldn't have declared
| bankruptcy, as that's exactly what happens in a bankruptcy
| proceeding.
| eastbound wrote:
| What do you mean "reimburse the scammed folks"? Any holder of
| bitcoins would receive a share of their money back?
|
| Whatever the FBI is up to, it's most certainly not
| reimbursing the customers.
| urmish wrote:
| Not the customers, but FTX lenders investors. There are
| likely tons of lawsuits filed by them to claim their piece
| of the govt seized assets. Its up to the govt to decide
| whether to help customers or investors and lenders.
| maerF0x0 wrote:
| The article is scant on details, so its unclear what the money
| would be used for...
|
| But why should the Government get a $605M payday for
| appropriating privately held assets? That sets up a dark conflict
| of interest.
| [deleted]
| my123 wrote:
| It's not a payday for the government. This money will be
| returned to creditors as part of the bankruptcy process.
| RC_ITR wrote:
| I think too many people got used to crypto's "well if the
| software says it..." mortal/legal/ethical code.
|
| They assume that traditional finance isn't a thoughtfully
| designed system with checks and balances because they were
| blindly railing against it before.
| maerF0x0 wrote:
| Perhaps, but the posted does not say that...
| burnte wrote:
| It also doesn't say that the shares were paid for with wire
| transaction as opposed to physical cash in stacks of $100
| bill, but that also is what happened. They're not going to
| explain the common bit in every story, only the unique
| bits. Whenever the gov't sells things in a bankruptcy or
| fraud proceeding, the money goes to the creditors/victims,
| and then fines.
| whateverman23 wrote:
| > Perhaps, but the posted does not say that...
|
| It doesn't say the government is profiting either. You just
| made that up.
| maerF0x0 wrote:
| Well, that piece is pretty easy to conclude. They
| acquired it for essentially nothing.
| meepmorp wrote:
| > Well, that piece is pretty easy to conclude.
|
| It's also an incorrect conclusion.
| pgwhalen wrote:
| You are missing a very obvious piece of the puzzle here:
| assets seized by the government during bankruptcy get
| used to offset liabilities of the bankrupt company. This
| doesn't need to be explicitly said; it wouldn't make
| sense for it to work any other way.
| [deleted]
| [deleted]
| freejazz wrote:
| Because they declared bankruptcy - that's how bankruptcy works.
| You declare bankruptcy, the gov't puts someone in charge of
| managing the sale of your assets in order to reimburse your
| creditors.
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(page generated 2023-09-01 23:02 UTC)