Problems at Bitvavo: crypto giant has lost € 280 million (for the time being).

Bitvavo, a sponsor of the KNVB, has been made vulnerable as a result of the FTX incident. Because to the inability of one of its business partners to make payments, the Amsterdam firm is 280 million euros in debt. Quote talked with CEO Mark Nuvelstijn. If it turns out that we need it, we have 280 million euros sitting around.

The “strike” service offered by Bitvavo is specifically impacted by the financial gap. Customers had the option of depositing their crypto assets into a dedicated pool, after which they were eligible to earn interest on the funds. The funds for this endeavor originated from the Digital Currency Group (DCG), a company that has lately seen a precipitous decline in value. And it is a sum of 280 million Euros that constitutes DCG’s current financial obligation to Bitvavo.

In November, DCG came into difficulties as a direct result of FTX’s decline. Because of this, it was unable to make payments to a number of its most important customers for a period of time, including Gemini, which is controlled by the American brothers Tyler and Cameron Winklevoss. It would seem that Bitvavo is also one of those consumers who was scammed.

lost €280 million

The Amsterdam firm had previously declared that it was not in risk from the demise of Genesis. The news that has come to light is astounding. Why wasn’t it stated sooner that there was a relationship with Genesis, even if it was just indirect? Quote’s CEO, Mark Nuvelstijn, was quoted as saying, “We didn’t realize it was an issue.” It wasn’t until we got word about it from DCG that we decided to take action.

Bitvavo has said in a prior announcement that it intended to be open and honest on the dangers they face. The firm did not believe that the obvious danger posed by DCG, its parent company, was important enough to disclose to its clients. According to Nuvelstijn, “We Assumed There Was No Risk.” [Citation needed]

Nuvelstijn is unable to recall the length of time that Bitvavo has been aware of this. “I can’t tell for certain,” is what he says. Is it days or weeks? “Something along those lines,” the CEO, who was 31 at the time, stated. “However, I cannot recall the specifics.” He underlines that Bitvavo primarily wanted to take the time to find a solution for the consumers, but he is unable to provide any information about the amount of time that passed between when they heard the news and when the communication was scheduled to take place.

According to Nuvelstijn himself, it seems that the issues are no longer being overlooked. According to what he has said, “We vow to always paying our consumers when it is required.” Does this imply that Bitvavo is ready to make a payment of 280 million euros at any time? “Yes,” is the terse response he gives. In the year 2021, Bitvavo brought in a total of 175 million euros in revenue. In addition to that, our performance in prior years has consistently been above average.

Bitvavo claims that it is responsible for managing a total of 1.6 billion euros. According to Nuvelstijn, in the event that all clients choose to withdraw that money at the same time, Bitvavo is able to pay for it all by itself and can thus always transmit it. There are no other constructions that compare to sprinting with DCG in our arsenal. Nuvelstijn is unable to provide an accurate count of the number of persons that participated in the striking pool.

Young Millionaires

In spite of the rough year that the cryptocurrency industry has (nearly) experienced, Bitvavo reportedly assured Quote in the past not to be concerned about the future of the firm. The precise number for 2021 has not been disclosed by Bitvavo as of yet.

Quote had a lengthy conversation in February of this year with Mark Nuvelstijn, founder and CEO of the company, about the booming business it was experiencing at the time. According to our list of Young Millionaires, the combined wealth of Nuvelstijn and his business partners Tim Baardse and Jelle de Boer was valued at an estimated €150 million.

The firm is so successful that it became a sponsor of the KNVB. Because of this, the name of the company is often highlighted by NOS before to matches being played at the World Cup in Qatar.

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