Dutch crypto exchange Bitvavo claimed to have received an offer from Digital Currency Group (DCG) on January 9th to repay 70% of its debt within an acceptable period.
However, the company refused the offer citing that the crypto conglomerate has sufficient funds available for full repayment.
- The development comes days after the trading platform revealed it is actively engaged in conversations with DCG to recover the resulting debt along with other creditors and advisors.
- The official statement read,
“The residual amount is still under discussion with DCG as they are only willing to repay part of it within a period acceptable to Bitvavo. As creditors, the latter is not acceptable because DCG has sufficient funds available for full repayment.”
- Digital Currency Group is currently under investigation by the US Department of Justice’s Eastern District of New York as well as the Securities and Exchange Commission (SEC). The focus is on the internal transfers between the company and its troubled subsidiary – crypto lending – Genesis Global Capital.
- The ongoing financial distress was spurred by Genesis becoming one of the companies to be affected by the FTX contagion.
- It halted withdrawals on November 16th, citing liquidity issues, and has been involved with investment bank Moelis & Company for restructuring purposes.
- It was earlier reported that Genesis owes $900 million to the crypto exchange Gemini. The two platforms jointly operated together a product called Gemini Earn, which enabled users to earn 8% interest on their loans.
- Gemini also accused DCG of failing to repay Genesis, which, in turn, resulted in the failure of payments to its clients.
- Since the unraveling, Barry Silbert, the head of DCG, has been under tremendous backlash. Cameron Winklevoss, the Gemini co-founder, claimed that Silbert has been unwilling to find a solution and even requested that the Board remove him as the CEO.