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Dutch exchange Bitvavo rejects DCG’s proposal to repay 70% of debt

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Cryptocurrency alternate Bitvavo, a significant creditor of the troubled crypto firm Digital Forex Group (DCG), has dismissed DCG’s proposal of partial debt compensation.

Bitvavo formally announced on Jan. 11 that the agency acquired a counter proposal from DCG providing to repay about 70% of the excellent quantity in a time period acceptable to Bitvavo.

The remaining steadiness quantity remains to be beneath negotiation with DCG, as it is just able to repay a part of the debt inside a time period acceptable for Bitvavo, the alternate mentioned, including:

“As collectors, we don’t discover the latter acceptable as a result of DCG has adequate sources obtainable for full compensation.”

Bitvavo emphasised that the present state of affairs relating to DCG has no influence on Bitvavo’s clients, platform, or companies. “Bitvavo ensures the excellent quantity and has thus taken over the danger from its clients,” the agency famous.

The announcement got here quickly after Bitvavo determined to pre-fund about $290 million in property locked on DCG to keep away from reliance on the troubled agency. The Dutch crypto alternate mentioned it had sufficient sources to proceed serving its clients with out disruption. The alternate expects DCG to refund excellent balances, regardless of the latter experiencing an enormous liquidity disaster amid the bear market.

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Within the newest assertion, Bitvavo talked about an identical state of affairs confronted by the Winklevoss brothers’ crypto alternate, Gemini. On Jan. 10, Cameron Winklevoss wrote a public letter to the DCG board, accusing CEO Barry Silbert of fraud and calling for the alternative of Silbert as CEO. With DCG and its crypto lending subsidiary Genesis Capital owing Gemini $900 million, the Gemini founders are assured that there’s nonetheless a risk of a optimistic resolution to the satisfaction of all events concerned.

“Like Gemini, we share the arrogance {that a} resolution may be discovered to the satisfaction of all concerned,” Bitvavo famous.

Associated: It’ll be OK: DCG crisis likely won’t ‘include a lot of selling’ — Novogratz

DCG and Genesis are among the many main crypto trade corporations affected by the large contagion following the collapse of the FTX crypto exchange in November 2022. The state of affairs turned extra precarious for DCG after america Division of Justice reportedly launched an investigation towards the agency in cooperation with the Securities and Trade Fee.

On Jan. 10, DCG’s Silbert wrote a public letter to shareholders defending his selections and offering particulars of a number of loans from Genesis and relationships with corporations like Three Arrows Capital.