$190M In Crypto Lost As Exchange Founder Dies With Only Password

$190M In Crypto Lost As Exchange Founder Dies With Only Password

Gerald Cotten, the 30-year-old founder of QuadrigaCX, died in India on December 9, 2018 due to complications from Crohn's disease, according to a sworn affidavit by his wife, Jennifer Robertson.

The online startup can't retrieve about US$145 million in Bitcoin, Litecoin, Ether and other digital tokens held for its customers.

The court-issued order means QuadrigaCX will have 30 days of initial protection from its creditors to allow it to come up with a "Plan of Arrangement". “If this situation continues, the users may seek legal proceedings against Quadriga which would only serve to complicate an already hard situation.”.

"There's a large number of folks owed a large amount of money", lawyer Maurice Chiasson told the court.

Meanwhile, a spokeswoman with Nova Scotia RCMP confirmed Tuesday they are assisting with an investigation into QuadrigaCX. Worse still, the company fears these Bitcoins may be lost forever.

"We still think. there is up to $180 million in cryptocurrency floating around".

As Gizmodo summarized, QuadrigaCX therefore "cannot repay most of $190 million in client holdings", since Cotten was the only person who could access the money. On its website, QuadrigaCX said it's been working for weeks to locate and secure the cryptocurrency reserves, but hasn't succeeded.

In seeking protection from creditors, Robertson said she had convened a board of directors to run the company.

"They don't immediately know what is real and what is not", he said.


"Unfortunately, these efforts have not been successful", the statement added. As previously reported on Cryptonews.com, one Reddit has user claimed that several wallets had initiated transactions soon after the QuadrigCX case had hit the news. A technical expert they hired hasn't been able to bypass the encryption, she said. He had no physical office and the work was done through his personal laptop.

QuadrigaCX's founder Gerald Cotten. Its database has around 363,000 users.

Quadriga does not have any corporate bank accounts.

"I do not know the password or recovery key", Robertson said.

Court documents show that Quadriga had been facing liquidity issues over the past year but a major issue arose in January 2018 when CIBC froze roughly $25.7 million of its funds held in the account of a third-party processor.

If QuadrigaCX does not have a Bitcoin cold wallet as Zerononcense's report suggested, it could raise questions on the whereabouts of the funds.

QuadrigaCX says it should be able to pay back its creditors, if the exchange can avoid bankruptcy and access said funds from the now lost cold wallets.

While it is common practice for cryptocurrency exchanges to store assets in "cold wallets" - offline storage locations to protect them from hackers - it is not clear where Mr. Cotten stored the millions of dollars owed to those who traded with his company.

Related Articles

  • Ariana Grande Not Attending Grammys Over Disagreements With Producers!

    Ariana Grande Not Attending Grammys Over Disagreements With Producers!

    After releasing her fifth studio album, " thank u, next ", Ariana Grande was reportedly supposed to perform at the 2019 GRAMMYs . When people inevitably decry how irrelevant the Grammys have become, please direct them to exhibit A: an Ariana Grande no-show.
    Weather Authority: Rain and freezing rain tonight into Monday

    Weather Authority: Rain and freezing rain tonight into Monday

    The National Weather Service in Flagstaff expects a combination of rain and snow with snow levels close to 6,500 feet. Some sun returns to wrap up the week, but it is going to be a bit colder.
    Chelsea's Hazard backs new signing Higuain to succeed in England

    Chelsea's Hazard backs new signing Higuain to succeed in England

    He's a great striker. he can hold the ball, he can play one touch, he's intelligent. Victory lifted Chelsea back into the top four above Arsenal .
  • The world record-holding Instagram egg finally cracked

    The world record-holding Instagram egg finally cracked

    In a cryptic announcement made through a Hulu episode titled "The Reveal", the true meaning of our lil egg friend was unveiled. The page was set up at the start of January, and encouraged people to make its only photo the most-liked post on Instagram .
    Mourinho accepts one-year jail sentence for tax frau

    Mourinho accepts one-year jail sentence for tax frau

    These charges relate to undeclared revenue regarding image rights in 2011 and 2012, when Mourinho was manager of Real Madrid. He had previously paid a fine of 1.14 million euros in 2015 for an administrative offense related to the same case.
    Top General Says He Wasn't Consulted on Syria Withdrawl

    Top General Says He Wasn't Consulted on Syria Withdrawl

    Mr Trump's December announcement about withdrawing troops from Syria came as a shock to both U.S. allies and his own officials. In general, he said officials were "aware that he had expressed a desire and intent in the past to depart Iraq, depart Syria".
  • Injured Guptill out of India T20 series

    Injured Guptill out of India T20 series

    With MS Dhoni , Dinesh Karthik and Rishabh Pant in the side, there is a lot of chances they keepers might be rotated. Both sides will look to maximise every global exposure that comes its way, thus adding some context to the T20Is.
    Respawn unveils free-to-play battle royale game Apex Legends

    Respawn unveils free-to-play battle royale game Apex Legends

    Be sure to read the entire piece over at Eurogamer , which provides some more detail about the development of Apex Legends . This kind of resurrection isn't typical in a battle royale game, so the mechanic should offer a fresh gameplay element.
    Super Bowl TV ratings hit 10-year low for Patriots win

    Super Bowl TV ratings hit 10-year low for Patriots win

    Brady was joined in the record books by 66-year-old Bill Belichick who becomes the oldest coach to hoist the Vince Lombardi trophy, Reuters reported .
  • Facebook Posts Record Profits Despite a Year of User Data Scandals

    Facebook Posts Record Profits Despite a Year of User Data Scandals

    The group estimates it has 2 billion active users across all its apps including Facebook , Instagram , Messenger and WhatsApp . But analysts say the trust issue is crucial for Facebook if it wants to move forward in its mission to connect the world.
    Chinese New Year 2019: The Year of the Pig IN PICTURES

    Chinese New Year 2019: The Year of the Pig IN PICTURES

    Another part of the festivities is "hongbao" or red envelopes containing money, which are given to family and friends. Qian's hometown, Suzhou in the Southern China, uses many traditional Chinese New Year customs from the region.
    ISIS could come back in Syria within six months: Pentagon

    ISIS could come back in Syria within six months: Pentagon

    Salih's comments came hours after Trump appeared on CBS' " Face the Nation " claiming troops were in Iraq to keep tabs on Iran. A source familiar with Trump's plans also confirmed to Politico that he planned to announce the summit during the address.