The HOOD stock falls to a monthly low as investors fear the sale of 56 million shares. Other crypto stocks, such as COIN and MSTR, continue to fall.
The bears tighten their grip on cryptocurrency stocks as Coinbase (COIN), MicroStrategy (MSTR), and Robinhood (HOOD) continue to fall.
Sam Bankman-Fried recently admitted in a court filing that he borrowed $546 million from Alameda Research to acquire a 7.6% stake in the stocks and cryptocurrency investing platform Robinhood.
Emergent Fidelity Technologies, a special purpose holding company owned 90% by Sam Bankman-Fried and 10% by Gary Wang, is in charge of the shares’ custody. There is a possibility that these HOOD shares will be liquidated.
Yonathan Ben Shimon, an individual investor, is one of the many creditors claiming ownership of HOOD Shares. He claims that FTX may have used investor funds to acquire a 7.6% stake in Robinhood.
“Emergent acquired a 7.6% stake in Robinhood for approximately US$650 million, possibly using funds improperly diverted from those invested by me and others in FTX. “I know nothing about the funds used to acquire the 7.6% interest in Robinhood other than that it was allegedly working capital,” the court document states.
However, Sam Bankman-Fried explains that he and Gary Wang, the co-founder of FTX, obtained funds from Alameda to purchase HOOD stocks.
As Sam Bankman-Fried is charged with diverting funds to make dubious investments through Alameda, the community believes it was customers’ funds the entire time.
The price of HOOD shares is trading near monthly lows amid the confusion surrounding ownership. HOOD is currently trading at $7.73, down more than 90% from its all-time high of $85.
Not only HOOD, but bulls are also struggling to gain control of other crypto-related stocks. COIN is currently trading at an all-time low of $32.66. The stock was already down more than 90% from its all-time high, and it has dropped another 28% this month. This month, the price of MicroStrategy stock has dropped by more than 25%.