Arbitrade has put 38 gold bars on show to accompany its latest claim about the billions of dollars in bullion it has to back its crypto tokens.

It has provided two photographs which show gold bars stacked in front of a card that features Arbitrade’s logo and the names of four of its crypto tokens, including “dignity” the token that is currently in circulation.

The Royal Gazette is seeking further clarity on the press release, which mentions a $250 million credit being provided to Arbitrade by its precious metals procurement agent Sion Trading FZE. It also claims that a shipment of $3.8 million of gold bars has been sent to it, through Sion, and that the bullion is now vaulted in Dubai.

Arbitrade is a cryptocurrency exchange and coin company that is registered in Bermuda, and has acquired the Victoria Hall office block to be its global headquarters. It is in the process of applying for its subsidiary Arbitrade Exchange (Bermuda) Ltd to be licensed under the Digital Asset Business Act 2018.

In November, Arbitrade’s chief executive officer Len Schutzman said the company had “title” to 395,000 kilograms of bullion, which would be worth $16.4 billion today. The company plans to use the bullion to back a number of crypto tokens.

However, Arbitrade has not said who has given it title to the gold and under what conditions, or where the gold is, or the name of the “independent public accounting firm” that it says has verified the account. It has stated the reason for this is because it is legally bound by non-disclosure and privacy obligations.

In its latest press release, Arbitrade said “Sion has provided $250 million in credit to facilitate these [gold] purchases on Arbitrade’s behalf”. It also said it was “happy to confirm that it has completed the purchase and vaulting of the additional $3.8 million of hallmarked gold bars through Sion”.

The Royal Gazette has sent four questions to Arbitrade’s Bermudian-based law firm Trott & Duncan regarding the release.

We have asked why Arbitrade is continuing to add to its bullion stockpile after it had stated it already had title to 395,000kg of gold.

We asked this, because the previous amount it said it had title to is sufficient to meet Arbitrade’s stated requirements for backing its crypto tokens, based on details it released last year.

We also asked why Arbitrade needs $250 million in credit from Sion to make the purchases, and how and when that will be paid back, and why there were only 38 single kilogram bars on show in the two photographs — 20 in one, 18 in the other, representing a value of about $1.5 million.

In addition, we queried two mistakes on the Arbitrade card in the photographs, where the crypto token dignity is spelled as “dignaty”, and the sentence below appears to read: “Trade tokens backed by real precious metals for the only real trade”, with the word tokens spelled as “tokes”.

Sion Trading holds a commercial licence in the Ras Al Khaimah economic zone of the United Arab Emirates, where its activity is listed as trading non-manufactured precious metals. It is a subsidiary of Scotia International of Nevada Inc, a mining equipment supply company based in Salt Lake City, Utah.

This month, Sion announced it is set to become a major shareholder of Arbitrade, having entered into a conditional agreement for the acquisition of the shares in Arbitrade Ltd currently held by Leila Holdings Ltd, a Bermuda exempted company owned by Arbitrade founder Troy Hogg. The deal is subject to approval being granted by the Bermuda Monetary Authority.

The Royal Gazette is awaiting a response to its questions about the latest gold bullion announcement. We are also awaiting answers to a separate set of questions sent to Arbitrade a month ago.

Arbitrade’s dignity token peaked in value at about 29 cents in May, but has declined and is now valued at about 0.6 of a cent per token on CoinMarketCap.