DCG Update Statement (15-12-2022)

Bitvavo15 déc. 2022

Bitvavo Custody BV, a part of the Bitvavo Group, has used services from the Digital Currency Group and its subsidiaries ("DCG") to offer off-chain staking services to its clients. DCG is currently experiencing liquidity problems due to the current turbulence in the cryptomarket. As a result, DCG has suspended repayments until this liquidity issue has been resolved. DCG indicated that the outstanding deposits will be reimbursed and that it will present a plan in the coming weeks.

No impact on the Bitvavo platform

The current situation at DCG does not have any impact on the Bitvavo platform. Bitvavo will continue to offer the services that our customers expect from us.Bitvavo manages approximately EUR 1.6 billion in deposits and digital assets. Of this amount, EUR 280 million has been allocated to DCG. Bitvavo is able to prefund any locked assets at DCG, to ensure that withdrawals of customer assets will be able to be processed at any time, meaning that Bitvavo customers are not exposed to DCG liquidity issues.

Bitvavo, together with other corporate clients of DCG, is actively corresponding with DCG. The expectation is that the outstanding deposits will be reimbursed by DCG over time.

All deposits and digital assets of Bitvavo’s customers can be withdrawn immediately and at any time

Bitvavo has been making a profit since its inception and is in a financially solid position. In the unlikely event that the situation at DCG will change, Bitvavo will step in to protect its customers. DCG’s debt will not create an obstacle for Bitvavo to fulfil this obligation.

Off-chain staking services

Participating in the off-chain staking services is optional, and is disabled by default. Clients can choose to enable off-chain staking services, to earn additional rewards on their assets. Due to current market conditions and to protect our customers, off-chain staking rates will be revised in Q1 2023. While we understand adjusting future off-chain staking rewards impacts Bitvavo customers, we have concluded that there is currently no longer a sufficiently significant or stable market to offer the current off-chain staking rewards in a way that meets our standards.

Safety comes first

Bitvavo has become one of the leading European digital asset exchanges, thanks to our customers’ trust in responsibly handling digital assets. Bitvavo ensures that Bitvavo customers will have secure, safe and fair access to digital assets on the Bitvavo platform. At Bitvavo safety and continuity of our services will always be our paramount objective:

Customer assets are held 1:1
⁠Bitvavo is a full-reserve exchange and custodian. This means that customer funds held on Bitvavo are held 1:1 and available for withdrawal at any time and we do not do anything with your funds unless explicitly authorized and directed to do so by the customer.
Insured custody providers
⁠Bitvavo utilises insured custody providers, who specialise in the safe storage of digital assets.
The customer chooses
⁠Bitvavo will never use or lend the customer's resources without explicit permission. In addition, our risk management is designed to protect our customers' assets. For this reason, all customer credits can be withdrawn immediately and at any time.

Questions?

We are actively working to improve the transparency of the funds we hold for our customers. A comprehensive proof-of-reserve system is part of this. We will continue to actively inform our customers about developments. For any questions, please contact [email protected] or check the frequently asked questions.