Economy

Millions in cryptocurrencies frozen after Canadian founder's death

Millions in cryptocurrencies frozen after Canadian founder's death”

A cryptocurrency exchange in Canada has revealed they can't repay most of their clients' $190 million in Bitcoin, Litecoin, Ether, and fiat currency holdings, and no, it wasn't because of a 51 attack. The exchange's founder, Gerald Cotten, died a year ago, taking his encrypted access to the money with him and leaving a big problem for investors. As reported by NewsBTC previous year, the Canadian Imperial Bank of Commerce (CIBC) froze five accounts that were linked to Costodian Inc., Quadriga's payment processor, and Jose Reyes, its owner.

Long story short, through the use of in-depth blockchain analysis, Medication determined that QuadrigaCX never lost access to its Bitcoin holdings, along with the fact that that the BTC sum cited in the affidavit likely isn't accurate.

As of the end of January, Quadriga had some 115,000 users with balances in their accounts, Robertson said.

Cotten's widow, Jennifer Robertson, has filed for creditor protection, saying that the firm can not access coins in "cold storage", Coindesk reports.

"Quadriga's inventory of cryptocurrency has become unavailable and some of it may be lost", Robertson wrote in the filing.

Robertson has access to Cotten's laptop but writes that she is unable to open it.

The founder held "sole responsibility for handling the funds and coins" and no other members of the team could access the stored funds, she added. Discussion boards on Reddit are peppered with skeptical comments about the company's efforts to work out its issues, and some users say they have upward of $80,000 or $100,000 that has been locked away from them. After not being able to withdraw CA$15,000, he said, "They've left us completely in the dark". And she asked the court to give Quadriga "additional time to find whatever stores of cryptocurrency may be available" and resolve other outstanding issues.

Robertson has retained an expert to try to access the funds but he has so far not been able to do so.

That's not all the trouble for the Canadian company either, which has since filed for creditor protection in the Nova Scotia Supreme Court.

Robertson said Quadriga would consider selling its cryptocurrency platform as an option to fulfill its obligations to customers and creditors.



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