Key Takeaways
- FTX seems to be exploring the potential of buying the inventory and crypto buying and selling firm Robinhood.
- FTX has not prolonged a proposal to Robinhood and is barely contemplating the plan internally at this level.
- Robinhood’s inventory was valued at $9.12 as we speak, representing a rise of 14% over the previous 24 hours.
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FTX is exploring the potential of shopping for out the retail buying and selling agency Robinhood, based on experiences from Bloomberg, however has denied that it’s presently in talks with the retail buying and selling app firm.
FTX Reportedly Exploring Buyout
FTX is contemplating the way it might purchase Robinhood, the agency behind the main inventory buying and selling app of the identical title, based on reporting from Bloomberg. Bloomberg’s sources say that FTX is contemplating the plan internally and that no ultimate determination has been made. Moreover, Robinhood has not been approached by FTX with a proposal.
Since Bloomberg’s preliminary report, an FTX spokesperson has acknowledged potential partnerships with Robinhood however denied a buyout. That consultant instructed Blockworks that “there are not any energetic M&A conversations with Robinhood.”
FTX’s curiosity in Robinhood is well-known. Final month, FTX founder and CEO Sam Bankman-Fried paid $648 million for 7.6% stake in Robinhood by a separate firm.
The truth that FTX launched inventory buying and selling earlier this yr additionally makes the corporate’s relationship with Robinhood a beneficial one—both as a associate or a goal for acquisition.
Robinhood’s Lengthy-Time period Worth Is Falling
Robinhood was valued at $32 billion final yr, that means that such a buyout could be a major buy by any measure.
Right this moment’s information appears to have boosted the worth of Robinhood inventory (HOOD) to $9.12, a rise of 14% over the previous 24 hours. That development could also be partially because of unrelated comments from Goldman Sachs analyst William Nance as effectively.
Despite as we speak’s positive aspects, FTX might purchase Robinhood at a low worth. Robinhood’s inventory value has fallen dramatically within the long-term; HOOD is down 74% over the previous twelve months.
Robinhood’s decline in worth is probably going because of a short-lived buying and selling surge in 2021. Final yr, “meme shares” resembling GameStop and AMC turned well-liked however have since misplaced relevance.
FTX, in the meantime, stays in a robust place, whilst many firms are dealing with a “crypto winter.” In actual fact, FTX and its subsidiaries acquired two different corporations this month: the inventory clearing agency Embed Applied sciences and the crypto firm Bitvo. FTX additionally reportedly plans to purchase stake in BlockFi.
Over the previous 24 hours, FTX has seen $1.5 billion in buying and selling quantity. Its U.S. counterpart moved an extra $145 million.
Disclosure: On the time of writing, the creator of this piece owned BTC, ETH, and different cryptocurrencies.
