Canada's largest cryptocurrency exchange owes its customers $190million

Canada's largest cryptocurrency exchange owes its customers $190million

Canadian cryptocurrency exchange QuadrigaCX may be reaching for the ouija board - after its founder, Gerald Cotten, died suddenly with the only password, leaving his widow unable to access £145m in client funds.

Cotten, 30, died in India last December from complications from Crohn's disease, according to the company.

The debt filing comes weeks after Robertson announced that Cotten had died - an event she described as "a shock to all of us".

Bitcoins must be stored on servers and can be kept in "hot wallets", for immediate transactions, or "cold storage" as a sort of digital savings account to protect them from hackers, CBC News reported.

'[This includes] attempting to locate and secure our very significant cryptocurrency reserves held in cold wallets, and that are required to satisfy customer cryptocurrency balances on deposit.

QuadrigaCX had been plagued with legal trouble in the past year: In early 2018, the Canadian Imperial Bank of Commerce froze more than US$25m of QuadrigaCX's assets after noticing "irregularities" in the exchange's payment processes. Cotten's widow said she had an expert try hacking into the founder's computers and encrypted email, but to no avail. The company's stance has gone from "Quadriga's inventory of cryptocurrency has become unavailable and some of it may be lost" to "most, if not all" of their customers will suffer damages. "Despite repeated and diligent searches, I have not been able to find them written down anywhere".

While Robertson has hold of the founder's laptop, she is unable to retrieve any passwords for it.

In a statement posted on its website on January 31, QuadrigaCX said that it applied for creditor protection in the Nova Scotia Supreme Court "to allow us the opportunity to address the significant financial issues that have affected our ability to serve our customers".

Ms Robertson said in her affidavit she had received online threats and "slanderous comments", including questions about the nature of Mr Cotten's death, and whether he is really dead. She also asked the court to appoint worldwide accounting firm Ernst & Young to oversee its dealings while QuadrigaCX tries to recover the lost holdings.



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