The Drama Around QuadrigaCX Exchange's Demise Continues to Mount as More Inconsistencies Arise

The QuadrigaCX exchange has been in the news due to the fact that the platform claims that they are not able to have access to $150 million in virtual currencies. As per the company, the funds were stored by the CEO and Founder of the exchange, Geralnd Cotten, who died of Crohn’s disease when he was in India.

Get Free Email Updates!

*Action Required* Enter Your Email for Trending Crypto News & Coin Market Insights

I will never give away, trade or sell your email address. You can unsubscribe at any time.

As Mr. Cotten died, the private keys are yet unknown for those managing the exchange, which is currently experiencing liquidity issues. However, the platform did not experience these isolated problems. During the last months, some clients were not able to withdraw their funds apparently because the exchange experienced some banking issues.

Mr. Cotten died back on December 9, but the exchange did not inform about it until just a few weeks ago. During that time, the exchange has been offline for long periods of times and it did not provide the necessary information for users to know what was really happening with the platform.

According to a recent report released by Coindesk, the exchange says that it owes around 115,000 people close to C$190 million in both fiat and cryptocurrencies. Although this is the number of users that have been affected, the exchange has roughly 300,000 individuals that were registered on the platform and that didn’t have funds stored on the exchange.

It seems that nobody at the exchange is able to have access to the cryptocurrency reserves that the platform had. They do not even know where these funds were stored. The funds held by the exchange were the following:

  • Bitcoin (BTC) 26,500 ($92 million).
  • Bitcoin Cash (BCH) 11,000 ($1.3 million).
  • Bitcoin Cash SV (BSV) 11,000 ($707,000).
  • Bitcoin Gold (BTG) 35,000 ($352,000).
  • Litecoin (LTC) 200,000 ($6.5 million).
  • Ethereum (ETH) 430,000 ($46 million).

People close to Cotten was not able to have access to an encrypted laptop that he was using each day. Thus, it makes the whole situation much more complicated for blockchain analysts and those behind trying to recover the funds lost by the exchange. At the same time, the company has a legal fight with the Canadian Imperial Bank of Commerce (CIBC). About it, there is no clear information regarding when the funds might be restored.

$53 million are held by payment processors in fiat currency. This is something positive that would allow the exchange to solve some of the problems in which it is currently involved. During the court hearing on Tuesday, Maurice Chiasson, QuadrigaCX’s attorney, asked the firm EY whether it is possible to assist in finding a banking partner to endorse bank drafts. The payment processor Billerfy has $23 million in bank drafts. As CoinDesk reported, Billerfy managing director and owner José Reyes mentioned that they have not yet heard from EY regarding this issue. Although the company has $5 million held in other companies, the funds can be used to organize bankruptcy processes and other administrative tasks.

Now, Quadriga has around 30 days to try and recover the missing cryptocurrencies. During the next month, the exchange will also have to unlock the funds that it has and generate revenue. For example, it might be possible for the company to sell the trading platform.

Nevertheless, there are some analysts and experts that believe that there might not be any cold wallets. MyCrypto’s founder and CEO Taylor Monahan said that she would be surprised if they find a cold storage ether address. She wrote on Twitter that based on how the exchange managed the funds, they have only three primary wallets.

Back in 2015, Cotten explained that the platform uses multi-signature cold storage wallets to secure Bitcoin holdings. That means that there were multiple parties maintaining control of the private keys of a specific wallet. That means that not one, but two parties would have to sign a transaction before it can be approved.

The statement released by QuadrigaCX regarding this situation reads as follows:

“What we can tell you is that the CCAA process will allow QuadrigaCX to keep all options open to attempt to maximize the funds available for the company’s stakeholders. We will provide further updates to the extent possible.”

There are other conspiracy theories regarding Cotten and his death. According to a death statement issued on December 12 by J.A. Snow Funeral Home, refused to confirm or deny that it issued the document. Another death certificate that was shared on social media shows Gerald’s surname written in a bad way. Instead of saying Cotten it says “Cottan.”

This has clearly raised some conspiracy theories regarding where Cotten can really be and if he really died.

At the moment, there is no more information on the matter and there are several investigations being undertaken to understand what’s going on with the exchange and the funds lost. Whether they will be able to recover them is another topic.

Bitcoin (BTC), Ethereum (ETH), XRP (Ripple), and EOS Price Analysis Watch (Feb 7th)

Get 3 Free Bitcoin eBooks for Limited Time Only

Receive three exclusive user guides detailing a) What is Bitcoin b) How Cryptocurrency Works and c) Top Crypto Exchanges today plus a bonus report on Blockchain distributed ledger technology plus top news insights.

[Author Alert] The author’s opinions above are solely based on their own self-conducted research. Assume any and all authors are using, holding, trading and/or buying cryptoassets mentioned as a portion of his or her financial portfolio. Use information at your own risk, do you own research, never invest more than you are willing to lose.

[Domain Disclosure] The crypto-community content sourced, created and published on BitcoinExchangeGuide should never be used or taken as financial investment advice. Under no circumstances does any article represent our recommendation or reflect our direct outlook. We b-e-g of you to do more independent due diligence, take full responsibility for your own decisions and understand trading cryptocurrencies is a very high-risk activity with extremely volatile market changes which can result in significant losses. Editorial Policy \\ Investment Disclaimer

<< LIVE COIN MARKET CAP CRYPTOCURRENCY PRICES CHANGE + VOLUME >>

Coin Market Cap Price Change 24 Hour Volume
BTC $92.87B $5,256.6354 -3.55% $6.39B
ETH $16.43B $155.2190 -5.31% $2.97B
XRP $12.39B $0.2949 -2.55% $480.37M
BCH $4.72B $265.7018 -5.53% $295.94M
LTC $4.47B $72.6575 -1.75% $1.03B
EOS $4.41B $4.6709 -2.32% $1.16B
BNB $3.25B $23.0397 0.90% $176.33M
USDT $2.86B $0.9943 -1.04% $6.02B
XLM $1.89B $0.0992 -5.54% $51.93M
ADA $1.77B $0.0683 -5.95% $80.19M

<< TODAY’S TOP BITCOIN, BLOCKCHAIN AND CRYPTO NEWS HEADLINES >>

02:12 PM President of Venezuela, Maduro, Urges Citizens to Choose His “...
02:06 PM Nigerian Scammers Still At Large with $50,000 In Bitcoin, Acco...
01:56 PM India Puts Country's Future of Finance Fate Up for Grabs by Co...
01:42 PM Yoshitaka Kitao, CEO of SBI Holdings, Joins Ripple’s Board of ...
01:23 PM Here’s A Key Reason Why a Huge Surge in Bitcoin (BTC) Price Mi...
10:41 AM BITCOIN CASH Price Prediction Today: Daily (BCH) Value Forecas...
08:02 AM Verge Price Prediction Today: Daily (XVG) Value Forecast - Apr...
07:43 AM Ethereum Price Prediction Today: Daily (ETH) Value Forecast - ...
08:02 AM Dogecoin Price Prediction Today: Daily (DOGE) Value Forecast –...
07:04 AM DASH Price Prediction Today: Daily (DASH) Value Forecast – Apr...
06:42 AM Bitcoin Price Prediction Today: Daily (BTC) Value Forecast - A...
05:32 AM New York Attorney General’s Office Accuses Bitfinex Of Coverin...
12:54 AM Binance Coin Price Reaches An All-Time High After Bottoming in...
12:30 AM Digitex Bitcoin Futures Exchange Set to Launch April 30, Looks...
12:24 AM Iran Makes History with Country's First Ever Bitcoin ATM Setup...
12:17 AM Binance DEX User Beware as New Decentralized Exchange Terms Sa...
12:10 AM “Crypto Assets” Should Be Used, Rather Than “Virtual Currencie...
12:03 AM Messari Founder Goes Inspector Blockchain, Talks About Ripple'...
11:55 PM Analyst Calls Bitcoin the Ultimate “Decentralized” Project, Ar...
11:49 PM ETC Labs Launches EtherNodes Driving Up the Numbers for Ethere...

LEAVE A REPLY

Please enter your comment!
Please enter your name here

five × five =