Today's Date:October 2, 2023
Bitvavo Alleges Digital Currency Group Is Having ‘Liquidity Problems’

Bitvavo Alleges Digital Currency Group Is Having ‘Liquidity Problems’

DCG auxiliary Beginning has a withdrawal freeze on its loaning arm, and Grayscale’s Bitcoin reserve is exchanging at record limits.

Dutch cryptographic money trade Bitvavo says it has 280 million Euros ($297 million in USD) stayed with Advanced Cash Gathering (DCG), or 17.5% of the 1.6 billion Euros Bitvavo says it oversees in stores and different resources. Bravo guaranteed clients that the circumstance “no affects the Bitvavo stage.”

Bitvavo claims in a blog post that DCG is “experiencing liquidity problems due to the current turbulence in the cryptomarket” and that DCG “has suspended repayments until this liquidity issue has been resolved.”

In any case, a DCG representative let Reuters know that the assets are held by its “free auxiliary” Beginning, not DCG, and has connected with DCG for additional remarks.

Bitvavo answered to Reuters that it “considered DCG liable for the unavailable assets.”

DCG, headed up by SecondMarket organizer Barry Silbert, is one of the crypto world’s biggest and most popular crypto firms. It possesses Beginning, Grayscale, CoinDesk, Foundry, and Luno.

The five weeks since FTX’s collapse and bankruptcy filing have not been good to DCG.

Beginning froze withdrawals on its loaning arm one month prior and has not thawed them. Gemini, the trade claimed by the Winklevoss siblings (not a DCG auxiliary), thus needed to stop reclamations on its Procure item because its accomplice on Gemini Acquire is Beginning. Beginning supposedly owes Gemini Acquire clients $900 million.

The troubles at Genesis have put the finances of DCG into question. 

Bitvavo Alleges Digital Currency Group Is Having ‘Liquidity Problems’

On November 22, Silbert told shareholders that DCG owes Genesis $575 million but that, “We have weathered previous crypto winters, and while this one may feel more severe, collectively we will come out of it stronger.” Yet on December 3, the Financial Times reported DCG owes Genesis $1.7 billion

Grayscale Capital likewise faces critical headwinds, with New York’s multifaceted investments Fir Tree Capital Administration documenting a claim against the organization charging its Grayscale Bitcoin Trust (GBTC) had “possible botch and irreconcilable situations.”

The Grayscale Bitcoin Trust is a fund that enables investors to gain exposure to Bitcoin without buying Bitcoin themselves. It currently trades at a discount of -48.7% compared to the market value of the underlying asset, per data from CoinGlass.

On Friday, crypto expert Will Clemente, prime supporter of Reflexivity Exploration, noted on Twitter a forceful selloff in the beyond 48 hours of numerous digital currencies attached to DCG, estimating it very well may be DCG searching for liquidity.

Filecoin and Flow, both of which Clemente claimed DCG has exposure to, have dropped around 20% and 10% in the past 24 hours according to CoinGecko data.

The Official News Desk of UNFT News

Leave a Reply

Your email address will not be published. Required fields are marked *