Today, several people with knowledge of the situation informed Bloomberg News that CEO Sam Bankman-Fried is considering how to acquire the stock and cryptocurrency trading software.
Another unnamed source claims that FTX has not yet made a final choice and that Robinhood has not yet been formally contacted with an offer.
FTX may purchase Robinhood
On hearing about the possible takeover, HOOD shares soared, rising approximately 14% to $9.12 as of this writing. Just a few weeks ago, the stock hit an all-time low of $6.89.
Although he and FTX are “enthusiastic about Robinhood’s commercial possibilities and various ways we may work with them,” Bankman-Fried said in a statement to Decrypt shortly after the story surfaced that “No active M&A conversations about Robinhood are currently taking place,”
Bankman-Fried purchased 7.6 percent of Robinhood last month, declaring at the time that he had no plans to use his own to influence or affect the company’s course.
Since reaching a top of $55 shortly after its IPO in July of last year, shares of the well-known trading app have slowly decreased. HOOD was downgraded by Goldman Sachs from “neutral” to “sell” in April.
Only a few weeks later, the corporation fired hundreds of workers, blaming a decline in retail investment activity throughout the world.
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However, their fortunes might be changing. While Robinhood’s income decreased overall in the first quarter of 2022, one sector continued to expand:
“The status of HOOD was recently upgraded back to “neutral” by Goldman Sachs due to increasing interest rates, which the firm anticipates would “help decrease HOOD’s losses to a tolerable level.”
FTX was reportedly in talks to buy a share in the troubled crypto lending startup BlockFi on Friday, according to a report.
BlockFi had earlier last week obtained a $250 million line of credit from Bankman-business.
Fried’s Many believed the loan to be a “bailout” since it will be paid back to clients before FTX is. The loan will be subordinate to client cash.
Source: https://www.thecoinrepublic.com/2022/06/28/crypto-breaking-ftx-to-buy-robinhood/