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FTX founder says no talks to buy Robinhood

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Shares of Robinhood, a struggling stock trading platform, surged 14 percent on Monday after reports that crypto millionaire Sam Bankman-Fried's firm FTX is considering a possible acquisition of the company. Amongst behemoths like Coinbase and Binance, FTX has also grown to be one of the most popular and largest ($10 billion average daily trading volume) cryptocurrency exchanges in the world. The UK market woke up to the news that FTX is "deliberating internally" on how to acquire Robinhood, Bloomberg reports.

It was around 3 p.m. ET when the news of FTX's possible interest in Robinhood came to light. About ten minutes later, trading had resumed. In a statement, Robinhood refused to respond to questions. A message left for FTX seeking comment was not immediately returned. A takeover of Robinhood has not yet been formally approached by FTX, according to the sources, and the company has yet to make a final decision. In an email to Bloomberg, Sam Bankman-Fried (SBF) stated, "We are enthused about Robinhood's business possibilities and the possible ways we could collaborate with them. However, there are no active M&A discussions taking place with Robinhood”.

Company documents show that Robinhood co-founders Vlad Tenev and Baiju Bhatt hold more than half of the company's voting power. Emergent Fidelity Technologies, a firm owned by SBF, purchased a 7.6 percent investment in Robinhood (HOOD) valued at $648 million in an SEC filing weeks earlier. The third-largest shareholder Emergent, a SBF founded company, was founded with the purpose of this purchase. Because it was "an attractive investment," the company stated in the petition. Subsequently, after the news was clarified the share price of HOOD started correcting towards market close yesterday. We will see if the sell off remains at the US market open.

This year, Robinhood introduced a crypto wallet feature. It's been a rough year for investors in Robinhood, which has seen its stock fall by more than half since January, as the market struggles to recover from the fallout from the COVID-19 outbreak that made the business famous among retail "meme stock" traders.

According to Robinhood's first-quarter financial results released in April, the company lost $392 million. Annual revenue fell 43% to $299 million in the third quarter, and the business admitted that its monthly active user base had shrunk. The rapid expansion of the company's employees had resulted in job overlap and the company had to lay off 9% of its workers in that month.

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Can you use Robinhood and FTX in the UK?

Robinhood is registered with the SEC and only available for US citizens. There are no current plans reported by Robinhood to expand into the UK. "We are looking into the UK and thinking about expanding into the U.K. and we are just starting discussions with the FCA," Patrick Gruhn, head of FTX Europe told CoinDesk in an interview at the end of March.

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Author: Hassan Alzaza

Author: Hassan Alzaza

My Name is Hassan Al-Zaza, I am a detail-driven and experienced SEO Content Writer living in Germany with over ten years of experience developing and producing top-notch content. I have a Bachelor's degree in English Language and Literature and a Master's in Business Communication. I have been working for 12 years in marketing, Content Writing, and ad Copywriting across SMEs, corporate, and public sector organizations in the EU and the Middle East region. I helped build brands for a wide range of successful companies from IT and software consultancies to the finance industry, tourism, and retail.

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