Robinhood Shares Jump 15%, Trading Halted After Report That Crypto Exchange FTX Could Buy The Company

Breaking Markets Robinhood Shares Jump 15%, Trading Halted After Report That Crypto Exchange FTX Could Buy The Company Sergei Klebnikov Forbes Staff I cover markets and business news. New! Follow this author to improve your content experience. Got it! Jun 27, 2022, 03:45pm EDT | Share to Facebook Share to Twitter Share to Linkedin Topline Shares of popular stock trading app Robinhood surged higher on Monday after reports that billionaire Sam Bankman-Fried’s cryptocurrency exchange, FTX, is considering a deal to buy the company just over a month after he first disclosed a stake.

The news comes just over a month after FTX’s billionaire founder, Bankman-Fried, disclosed a sizable . . .

[+] stake in Robinhood. Spencer Platt/Getty Images Key Facts One of the largest crypto trading exchanges in the world rivaling the likes of Coinbase and Binance, FTX is internally debating how to pursue a full acquisition of Robinhood, Bloomberg first reported on Monday, citing people familiar with the matter. Shares of Robinhood spiked on the news, rising as much as 18% before getting halted for trading shortly at approximately 3:10 p.

m. ET. The stock held onto most of its gains after trading resumed at 3:15 p.

m. , still rising by roughly 15% on Monday. Robinhood is yet to receive a formal takeover offer, while FTX has not made a final decision on whether to pursue the deal and could still opt out, according to Bloomberg.

The report comes just over a month after billionaire Sam Bankman-Fried, the founder and CEO of FTX, first disclosed a 7. 6% stake in Robinhood worth roughly $650 million, according to regulatory filings. Bankman-Fried at the time called Robinhood shares “an attractive investment, causing the stock to soar over 20% in a single day on May 14.

Key Background: Shares of Robinhood have largely struggled amid the wider market selloff in the first half of 2022, falling over 50% compared to the S&P 500’s roughly 20% decline. Investors have soured on the stock as the company continues to struggle with depressed user growth on its platform as well as declining trading revenues. Robinhood shares now trade at nearly $10 per share, still a far cry from a record high of $85 per share last August.

Tangent: Cryptocurrencies have been rocked by a massive selloff this year as investors flee to safer bets amid a backdrop of rising rates, high inflation and looming recession fears. The price of Bitcoin dropped below $20,000 earlier this month amid a handful of crypto firms either halting sales or announcing layoffs. Big Number: $20.

6 Billion That’s how much Bankman-Fried is worth , according to Forbes ’ estimates. After launching FTX in 2019, he is now one of the richest people in crypto, with his company reaching a $40 billion valuation at the beginning of 2022. Further Reading: Robinhood Shares Crater After Dismal Earnings, Monthly Active Users Fall 10% From A Year Ago ( Forbes ) Robinhood’s Troubles Could Get Worse As Stock Hits Record Low Amid Layoffs And Looming Quarterly Earnings ( Forbes ) Warren Buffett Cautions Against Stock Market ‘Casino’ As Charlie Munger Slams Robinhood ( Forbes ) Robinhood Losses Spell The End Of An Era For Young Investors Who’ve Never Traded Through A Downturn ( Forbes ) Follow me on Twitter or LinkedIn .

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