When QuadrigaCX announced last month that CEO Gerald Cotten had suddenly died and roughly $150 million in cryptocurrency ($180 million Canadian) was inaccessible as a result, the crypto world went nuts. According to a CBC report today, the notorious Bitcoin exchange may be sold to compensate victims. Additionally, Cotten’s encrypted laptop will be handed over to lawyers for the exchange’s creditors and “eventually given to a court-appointed monitor.”
Canada’s Biggest Bitcoin Exchange May be Sold
So far, the company filed for protections under a Depression-era law that prevents complete destruction of insolvent businesses in Canada. They are considering selling the exchange’s IP assets in an effort to satisfy debts.
However, in another bombshell report, CCN’s Joseph Young reported that there may be no such cryptocurrency to speak of. There is a lot of money on the line. It seems likely that the best efforts at cracking the laptop will be employed in an effort to recover the funds. But, like some analysts have suggested: there may be no cryptocurrency to recover.
“Some of the main addresses of QuadrigaCX also reportedly sent outgoing transactions after the death of its CEO Gerald Cotten, which should not be possible if the CEO had full control over all of the firm’s wallets.”
Combined with suspicions about the foundation of QuadrigaCX, rumors of an exit scam have cropped up.
So I saw a claim that Omar Dhahani is really Michael Patryn of the Quandringa Exchange.
Omar Dhanani has a pretty easy to find criminal history.
He also used the name Omar Patryn as an aka in a 2005 forfeiture case.
— Palley (@stephendpalley) February 5, 2019
This isn’t the first time those allegations have surfaced. Last year, QuadrigaCX responded to similar claims thus:
“We must have ruffled someone’s feathers. This guy is posting hypothetical nonsense about someone with a different name of someone who left our company more than two years ago.”
CCN is still investigating the issue of QuadrigaCX’s founding. If a relevant report comes of our investigation, our readers will be the first to know.
We have thousands of wallet addresses known to belong to @QuadrigaCoinEx and are investigating the bizarre and, frankly, unbelievable story of the founder's death and lost keys. I'm not normally calling for subpoenas but if @rcmpgrcpolice are looking in to this, contact @krakenfx
— Jesse Powell (@jespow) February 3, 2019
Local Traders Recount Experience with QuadrigaCX
QuadrigaCX grew up to become the biggest Bitcoin exchange in Canada. A Canadian wrote to this reporter describing his overall experience as positive, saying:
“I used it primarily because at the time my weekly purchase limit with Coinbase was fairly low, and since I wanted to purchase more than I could on Coinbase, Quadrigacx was a convenient way to go.”
In a follow-up e-mail, however, the anonymous Canadian wrote:
“I spoke to a friend however last night, who I loosely keep in touch with, who has more experience than I do with crypto. Long story short, his experience with QuadrigaCX was not positive at all. When he cashed out some crypto, the cheque they sent him was late by a month, and it bounced.”
“The exchange was the largest in Canada by volume until its sudden demise this month. The company’s public notices leave many details out. They are not the first Canadian exchange to suddenly face problems. MapleChange is another notable example.”
It seems the rest of the story of QuadrigaCX will play out in court. Whether it has any salable assets remains to be seen. Most of its moves in the coming months will be dictated by judges and lawyers.
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