QuadrigaCX , a Canadian exchange that lost access to its cold wallets, prevented the company from operating and knocked over the exchange’s liquidity. More details on the peculiar case have now been revealed.
The exchange lost access to the company’s digital assets and customers after founder Gerald Cotten, 30, died unexpectedly in India. Gerald was the only one who had the passwords for cold wallets that had almost $ 700 million in crypto-coins from users.
In a court hearing in Nova Scotia, widow Jennifer Robertson said that QuadrigaCX owes its consumers a total of $ 190 million in crypto-coins and fiduciary coins. The exchange has made a request for credit protection, since it can not access the wallets where the money is stored. All they have is access to the hot wallets , which contains considerably less money.
According to CoinDesk, the exchange has approximately 26.5 thousand Bitcoins (BTC), 11 thousand Bitcoin Cash (BCH), 11 thousand Bitcoin SV (BSV) and about 430 thousand Ether (ETH).
Robertson also said that Cotten was solely responsible for dealing with the values and currencies and that other team members had no access to storage. According to Quadriga, Cotten died late last year from complications with Chron’s disease while in India, where he was about to open an orphanage to get homes and shelter for needy children.
According to exchange and Jennifer Robertson, the former CEO’s laptop is still with them, however, nobody knows the password, no security expert has managed to break the computer’s encryptionand Cotten left no record or annotation with the passwords.
Exit scam accusations
Some reports suggest that a little bit of that value was moved after the case was released, but there is no definitive evidence. But these rumors, along with the rather odd circumstances of Cotten’s death, led the community to make accusations about the whole affair.
Some Cryptomaniac users say Cotten may have pretended his death, since no official documents were issued or the other board members used the opportunity for a exit scam, holding the crypts of the clients. Already according to the CCN , Jennifer Robertson included a death certificate for documents submitted to the court.
According to CBC information , the Canadian government was able to confirm that a Canadian citizen actually died in India but did not disclose further details for privacy reasons.
Curiously, according to some information , Gerald Cotten made a will about two weeks before his death, in the will he left Jennifer Robertson as the owner of the spoils and each of his two dogs received $ 100,000. At the time the will was made, Quadriga was already facing financial problems and had to return money to several creditors. Of course, this led many people to wonder why the will was more concerned with dogs than with the company.
The secret marriage, with no information or photos disclosed, also raises some doubts. Although the answer to that point may be the desire to have privacy. But still, many question the fact that the marriage was close to the death of Gerald Cotten.
Another point that catches the attention of speculators is that Chron’s disease may be fatal, but it hardly kills unexpectedly, as was the case of Quadriga’s former CEO.
As everyone knows, the cryptocercate loves to speculate, so the theories about what actually happened are appearing more and more on the internet.
A Twitter user posted an excerpt from a news story in which Cotten gives an interview.
“Cotten, in turn, talks about the security forces at Quadriga, noting that the exchange uses cold wallets of multiple signatures to store the bitcoins.”
If this is not a lie, then Cotten was not the only one able to access the stored crypto-coins.
Other legal problems
QuadrigaCX has had legal problems during the beginning of 2018 after the Canadian Imperial Bank of Commerce froze $ 26 million of the exchange accounts after “finding irregularities in the processing of payments” and a document from the Superior Court of Ontario concluded that “$ 67 million in transactions were improperly transferred to the person account of the payments processor “.
The legal issue has been resolved, but information says that the legal battle, as well as the problems with the payments processor, have left the exchange with serious problems. QuadrigaCX was unable to access tens of millions of dollars that were with the payment processor.
In the case, Robertson wrote that the exchange urgently needs time to get any crypto-currency resources that they can muster and negotiate the looting the bank can offer.
Customers who were affected by the problem did not stop expressing their opinion. In forums and social networks you find people making exit scam complaints, creating fake “Wanted” posters with Cotten’s face and more.
“I learned the lesson in the worst possible way,” Elvis Cavalic told CBC, adding that he was unable to cash out more than $ 15,000 in assets. “I’ll probably avoid crypto-coins in the future,” Cavalic said.
Cavalic’s thinking well sums up what these stories can do in the structures of the cryptomercado.