A cryptocurrency billionaire takes a huge stake in a meme-related business

A cryptocurrency billionaire takes a huge stake in a meme-related business ...

In early 2021, the billionaire founder of cryptocurrency exchange FTX has raised a significant share in a company that is rooted in the meme-stock mania.

Samuel Benjamin Bankman-Fried acquired the shares in a two-month period starting in March. Bankman-Fried is 171st on the Bloomberg Billionaires Index, with a net word of $11 billion.

Over the period, he accumulated a 7.6% share in the firm at moderate prices, from $8.28 to $13.53.

According to a SEC filing, Bankman-Fried acquired 56,273,469 shares in total. The stake was given a valuation of $648.3 million.

The Company

Robinhood (HOOD) is a business that Bankman-Fried is pursuing. - Get Robinhood Markets, Inc. Class A Report.

In early 2021, the online brokerage firm became a prominent tool for novice traders to raise the price of so-called meme stocks.

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By generating buzz in investing chat rooms on Reddit about heavily shorted companies, traders hoped to hike prices. This sparked pressure on those who short the stock to cover their positions, putting the stocks even higher in short squeezes.

Get GameStop Corp. Class A Reportand AMC Entertainment (AMC) - Get AMC Entertainment Holdings, Inc. Class A Reportwere among the firms that saw shares rise the most during the period.

At the time, Robinhood was faced criticism and congressional hearings over restrictions it allowed on customers trading during wild gyrations in stock prices.

The company tries to dodge the controversy before going public in 2021.

However, shares of Robinhood have remained steady down since then, ending the regular session on Thursday at $8.56.

Bankman-Fried said he intends to hold the shares as an investment and "has not currently have any intention of taking any action to change or regulating the control of Robinhood."

Shares of the brokerage increased by roughly 20% in after-hours trading Thursday to $10.80.

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