Bitvavo will receive 80% of DCG debt

Bitvavo just released a statement announcing that they expect to receive at least 80% of the debt owed to them by DCG. 

According to incoming reports, Digital Currency Group currently owes Bitvavo, a famous Dutch crypto trading network, around $300 million (280 million euros). Based on reports, Bitvavo is now optimistic that they will receive the settlement from DCG sometime in the future. 

The dutch crypto exchange believes that the settlement will be done after developing a recent in-principle deal between DCG and its creditors. The statement from Bitvavo partially says:

“The result submitted to the court amounts to an expected recovery rate of between 80-100%.”

Earlier this year, in January, the DCG proposed to make a 70% payment to Bitvavo’s debt. However, the exchange rejected this proposal, highlighting that DCG could still make a full payment. 

Since then, the duo has been trying to figure out a better deal. The new agreement, with a recovery of 80 to 100%, was agreed upon between the duo. The recovered amount should be paid in different forms, including cash, digital currency, and convertible preferred equity notes in DCG.

When making their announcement, Bitvavo mentioned that the agreement was reached on Feb 6th. However, the report noted that DCG will publish details about the satisfactory in-principle agreement between today and tomorrow. 

This will complete the long and hectic process of making the deal. The next phase involved working out the details. According to the Bitvavo statement, more elaboration, signing, and conclusion of the agreement under Chapter 11 proceedings will continue in the next few weeks. 

Later, the two will work out a Plan Support Agreement (PSA) from this deal and submit it to the “UCC” (“Unsecured Creditor Committee”) for approval. Approval by the UCC will mean the PSA will be ready to present to the bankruptcy court for ratification. This will open space for the execution process will commence, and repayment will be made.

Bitvavo’s deal with DCG comes after the latter’s subsidiary Genesis made an in-principle deal on restructuring. In the agreement with Gemini exchange and other creditors, Genesis should be sold, or its equity turned over to creditors. Many crypto networks suffered last year following the deaths of Celsius, Terra, and FTX— DCG, together with Genesis, were also impacted by the contagion.