Crypto exchange Bitvavo owed up to $300M by Genesis
European crypto exchange Bitvavo is part of the so-called creditors’ committee that is trying to wrestle more than $1.8 billion back from Barry Silbert’s Genesis Trading and its parent company, Digital Currency Group (DCG). This is according to sources familiar with the matter who spoke directly to Protos.
When Bahamas-based exchange FTX collapsed in November, Genesis was forced to suspend redemptions. As a result, in addition to freezing $175 million of Genesis’ trading assets, it also left Genesis and DCG owing three major creditors — $900 million to the Winklevoss twins’ Gemini, $350 million to a group of investors led by investment firm Eldridge, and, according to sources, up to $500 million to Bitvavo. (For the record, Bitvavo puts this figure at closer to $300 million.)
Bitvavo allegedly also saw its staking program affected. The platform offers up to 10% yield on staked assets and typically claims more than $40 million in daily transaction volume.
As part of their efforts to claw back their money, Gemini and Bitvavo have formed a creditors’ committee. They have also retained law firm Kirkland & Ellis as legal counsel and global investment bank Houlihan Lokey as financial advisor.
If the creditors are successful in taking back their funds, it could significantly cut into Genesis Trading’s finances.
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Update 17:35 UTC, Dec 15: Since this article was published, Bitvavo has contacted Protos to confirm that it is/has been a member of the so-called creditors’ committee.
According to Bitvavo, it has also conducted multiple lending transactions with Genesis in the past and is actually pursuing a net claim of somewhere in the region of $250-$300 million. This, it says, is dependent on the value of the underlying crypto assets.
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Bitvavo is due up to $500 million after Bahamas-based FTX collapsed, leaving Genesis Trading and Digital Currency Group owing $1.8 billion.
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