QuadrigaCX CEO Lost $190 Million in Crypto, Former Friend Says He Was Fearful

The untimely death of QuadrigaCX CEO Gerald Cotten has left $190 million worth of customers’ crypto funds inaccessible. Many theorized that Cotten faked his demise to disappear with the money. But according to his former friend and colleague, the late entrepreneur was not capable of taking such drastic measures.
Adam O’Brien told Global News that before his death, Cotten had mused him about being kidnapped for having access to a multimillion-dollar fortune. The Edmonton-based bitcoin entrepreneur claimed that Cotten was expecting troubles from every corner – that he was assuming that “something might happen.”
“Gerry was holding, we know, over $100 million, almost $200 million in funds,” O’Brien asserted. “That makes people do some pretty crazy things. And I think Gerry was aware of that.”
Dead Man’s Switch
Cotten’s widow Jennifer Roberston wrote in her affidavit that Cotten died of Crohn disease while taking a humanitarian trip to India’s Jaipur town. The local police issued a no objection certificate, confirming the circumstances surrounding Cotten’s demise, before sending his remains to Nova Scotia. The conspiracy theories about Cotten faking his death ended right there.
But the fact that Cotten did not pass down the passwords of wallets that held $190 million of customers’ funds with a trustworthy party raised doubts.
“I think here we do have one leg up in a dead man’s switch,” O’Brien said. “A dead man’s switch would be something that Gerry would have had to set up before he passed away.”

Crypto exchange #QuadrigaCX is facing accusations of lying about their CEO Gerald Cotton’s death to orchestrate what people believe is an exit scam from Day One. https://t.co/jEPiguUxBJ
— NEWSBTC (@newsbtc) February 6, 2019

A dead man’s switch is a computer program which transfers a human operator’s security credentials to a priorly designated receiver over non-activity for a specified period. So, for instance, the operator dies unexpectedly or fails to interact with his machine for a long time, a dead man’s switch automatically passes down the information to the next person in line, ensuring that data remains accessible to a human.
So far, investigators have unable to find out whether or not Cotten had a dead man’s switch system in place. If yes, it was necessary to find the person who might have gained access to QuadrigaCX missing millions following Cotten’s death. It was particularly stressing since one of the co-founders associated with the Canadian exchange had a criminal record in the US. Legal documents proved that the accused Omar Dhanani had changed his name to Michael Patryn to conceal his past.

Globe and Mail has found booking photos that clearly show Quadriga cofounder Michael Patryn is in fact convicted felon Omar Dhanani. https://t.co/XWLZfwcY3a
— Amy Castor (@ahcastor) March 1, 2019

No Crypto Recovery
O’Brien believed the affected 115,000 QuadrigaCX customers would not be able to recover their funds, solely because the way crypto technology worked.
“I don’t think people are going to see that money again. And the reason I don’t is [that] the way bitcoin is designed is that once the private key is gone, there’s no recovery,” O’Brien said.
The post QuadrigaCX CEO Lost $190 Million in Crypto, Former Friend Says He Was Fearful appeared first on NewsBTC.
Source: New feedNewsBTC.com

Bitcoin Exchange QuadrigaCX Goes Bankrupt; Will Ernst and Young Be Able To Recover The Users’ Assets?

The saga of QuadrigaCX Exchange has finally met the expected disastrous end as the Apex Canadian Court, Nova Scotia Supreme has finally declared the firm ‘bankrupt.’
Earlier this year, after the expected sudden death of the CEO of the exchange, Gerald Cotten in India, the cryptocurrencies of the 115,000 users stored in Cotten’s cold wallet were lost forever. According to the Exchange and the wife of the deceased Exchange CEO, Gerald was the sole manager and owner of the cold wallets which held the company and user assets as well.
The Supreme Court has earlier granted creditor protection and appointed Ernst and Young as an independent Monitor to investigate into the funds and assets of the defunct Exchange on Feb 5. Moreover, the Exchange has suspended all operations on January 28 after filing for creditor protection in on 30th of the same month.
What Happens Now?
Reportedly, Cotten had mixed his personal assets with the Exchanges’ assets in his wallets. Moreover, The report also said QuadrigaCX Exchange funds might have been used to buy assets “held outside the corporate entity.”
Ernst and Young had requested the Apex Canadian court to preserve the personal asset of Cotten for investor protection and shut down the Exchange. The Court’s order extends to all assets currently held by Gerald’s widow, Jennifer Robertson as well. Micheal Wood, the judge for the case has prohibited her from selling, transferring or removing any asset. However, she has been given leverage to cover her legal expenses from two bank accounts which are also being monitored.
Post-bankruptcy, Ernst and Young Co. will now have enhanced powers as a monitor and a trustee of the funds of the Exchange under Federal Bankruptcy and Insolvency Act.
Funds Stuck With Payment Processors
According to the reports by Ernst and Young, more than $70 million in user withdrawals is pending with payment processors which include banks and third-party entities. The Monitor, Ernst and Young and the payment processors seemed to have reached an impasse w.r.t to the pending withdrawals.
The Court has ordered the two parties to come up with a joint solution before April 18.
Moreover, the recovery of the rest of the amount estimated around $150 million will be made from the reserved assets of the Exchange and the deceased owner. It reminisce of the Mt. Gox Exchange where the user’s funds were hacked from the Japanese Exchange; only about 30% of the recovery has been made from the total amount of Bitcoins that were initially mangled.
Do you think that Nova Scotia Supreme Court, and Ernst and Young Co. can make a successful recovery of the full amount? Please share your views with us. 
The post Bitcoin Exchange QuadrigaCX Goes Bankrupt; Will Ernst and Young Be Able To Recover The Users’ Assets? appeared first on Coingape.
Source: CoinGape

QuadrigaCX: Bankruptcy the only option, claims court-appointed monitor Ernst & Young

Canada’s once-largest cryptocurrency exchange saw its revival prospects go from bad to worse after their court-appointed independent auditor, Ernst & Young, stated in their April 1 report that the exchange’s only option now was bankruptcy.
QuadrigaCX has been riddled in a slew of controversies following the death of CEO Gerald Cotten and the loss CAD $190 million [USD $143 million] locked in cold wallets. After wallet-hunting for over two months, reports suggested that the amount in question simply did not exist. However, there could be some respite for those affected.
E&Y stated that the exchange will seek to benefit from going down the insolvency path. If the restructuring shifts to the Bankruptcy and Insolvency Act [BIA], which indicates a straight path to bankruptcy, its assets can be sold off, leading to the exchange salvaging a proportion of their funds.
“Transitioning from the CCAA to the BIA will streamline the administration of the proceedings, reduce the level of professional involvement and provide enhanced investigative powers for the Trustee.”
The report further added that Peter Wedlake, the court-appointed chief restructuring officer, and Miller Thomson LLP and Cox & Palmer, the Representative Counsel, were both in favor of this proposition. Additionally, bankruptcy will be cost-effective to the Canadian exchange as court proceedings will decrease and professional legal costs in appointing new counsel for the exchange will be slashed.
Third Party Payment Processors
Payment processors affiliated with the exchange have also been looked into by the monitor, and on questioning reveal that some funds could find its way back to QuadrigaCX. E&Y stated that the Toronto-based POSConnect owed close to $300,000 to the Canadian exchange. However, under the terms of their agreement, the same would not be disseminated until April 28, 2019.
VoPay, another payment processor, holds around $217,000 of QuadrigaCX’s funds, but the same will not be sent back as the former had received several complaints from the exchange’s customers regarding “lack of communication.” Additionally, VoPay stated that the customers were also threatening to file criminal complaints and take legal action against the processor if the funds were not returned.
Alto Bureau de Change, a Montreal-based financial service company, has also been intimated by the monitor to return “any property” belonging to QuadrigaCX. The report stated that Alto denied any business between the two. E&Y, in their report, stated that the exchange advanced $190,000 to Alto, $160,000 of them in Bitcoin [BTC] and $30,000 in fiat. After the return of an initial amount, Alto holds between $20,000 to $37,000 of QuadrigaCX’s funds.
WB21, now Black Banx Inc, held a whopping CAD $8.9 million and $2.3 million on behalf of the exchange. In February, E&Y received a letter from WB21 stating that the exchange opened an account and entered into a contract with their Singapore branch. The letter added that WB21 Singapore had closed the exchange’s CAD and USD accounts on December 31, 2018 and that they were “entitled to freeze accounts and withhold funds if there was reasonable doubt that the end user had engaged in fraudulent or suspicious activity.”
Despite these claims by WB21, the report added,
“The Monitor continues to believe that WB21 may hold a significant amount of funds deposited by Affected Users.”
E&Y also mentioned that WB21 has been “uncooperative” and that it has “not provided even basic information” to the monitor regarding the agreement between the Canadian exchange and their Singapore branch.
Robertson Nova Counsulting Inc. [RNCI], whose sole director is Gerald Cotten’s widow Jennifer Robertson, was also mentioned as a third-party payment processor for the exchange, which the monitor was unaware of prior to the filing date.
Personal and Corporate
An Asset Preservation order will also be filed by the auditing giant, as the report spells out that Cotten and Robertson did not maintain their “corporate and personal boundaries.” QuadrigaCX’s funds were used to acquire assets outside the entity of the exchange, added the report.
Following discussions with Robertson’s counsel, the Asset Preservation Order was drawn up, which will involve,
“All assets held by the Cotten Estate, Ms. Roberston, the Seaglass Trust, Robertson Nova Consulting Inc., and Robertson Nova Property Management Inc. whether or not such assets are in the names of the respective parties and whether they are solely or jointly or beneficially owned.”
This order will prevent the sale of any assets with the above entities. Robertson and her counsel have agreed to prepare a list of relevant assets which will be communicated to the monitor for review. E&Y added that the order is a “positive development” for the exchange’s stakeholders as it will allow them to investigate QuadrigaCX’s “business and affairs” without any interference.
Lastly, the auditing giant stated that the QuadrigaCX saga might be veering to a close next week as a final report detailing the entire investigation will be presented to the court soon. The report concluded,
“The Court fapprove (approve) the transition of the CCAA administration into bankruptcy proceedings under the BIA and grant the Transition Order, the Asset Preservation Order and the Third Party Payment Processor Order, each in the form sought by the Monitor.”
The post QuadrigaCX: Bankruptcy the only option, claims court-appointed monitor Ernst & Young appeared first on AMBCrypto.
Source: AMB Crypto

Relief For QuadrigaCX Victims, E&Y Proposes Bankruptcy For the Shuttered Exchange

Well, probably the most dramatic case in the history of cryptocurrency seems to be headed to an end. According to the recent report that has been released, Ernst and Young (EY), the court-appointed monitor for the shuttered cryptocurrency exchange QuadrigaCX, has proposed moving the company from a restructuring process to bankruptcy proceedings.
E&Y believes the transition will streamline the administration of the proceedings
The fourth report of Monitor presented by Ernst and Young (EY) in QuadrigaCX case in the Supreme Court Of Nova Scotia has suggested the transition of the case from relief under the Companies’ Creditors Arrangement Act (CCAA) into proceedings under the Bankruptcy and Insolvency Act (BIA). According to EY
“Transitioning from the CCAA to the BIA will streamline the administration of the proceedings, reduce the level of professional involvement and provide enhanced investigative powers for the Trustee,”
In the report, EY mentions this proposed move was in consultation with Peter Wedlake, the Court-appointed Chief Restructuring Officer (the “CRO”), Representative Counsel and Stewart McKelvey in respect of possible alternative processes to administer the QuadrigaCX insolvency proceedings.
EY believes the proposed move will offer the following benefits

A bankruptcy would allow for the potential sale of assets, including but not limited to Quadriga’s operating platform, should it be determined to be of value and if such a sale was determined to be feasible and beneficial;
Governance issues would be addressed through the appointment of the Trustee for each of the Applicants thereby eliminating the need for the CRO or directors;
Representative Counsel and the Official Committee could continue to participate in a bankruptcy process along with inspectors appointed at the first meeting of creditors (though the same individuals may fulfill both roles); and
The Trustee will have additional investigatory powers without further relief from the Court that will be of assistance in the ongoing investigation of the business and affairs of the Applicants, including the right to compel production of documents and seek examination of relevant parties under oath.

Apart from all of these benefits, EY believes this process would be a more cost-effective option for administering the Applicants’ estates. EY also believes that this move would also be beneficial for Affected Users as it would streamline the whole process.
According to EY, its research into Quadriga’s missing funds might be nearing an end and a monitor, it plans to file a final report in the next few weeks, which would update the court on what progress it has made, through Tuesday’s filing did not provide any clarity on the exchange’s missing cryptos.
While the report does point that bankruptcy is the best way out for QuadrigaCX to end this mess, affected users will definitely wait for the final report to get more clarity on the missing cryptos.
Will the move Bankruptcy and Insolvency Act provide the much-needed relief to affected stakeholders of QuadringaCX? Do let us know your views on the same.
The post Relief For QuadrigaCX Victims, E&Y Proposes Bankruptcy For the Shuttered Exchange appeared first on Coingape.
Source: CoinGape

Max’s Corner: Selling Bridges

Coinspeaker
Max’s Corner: Selling Bridges
This week we will get into the backstory behind the Quadriga Affair, take a look at another scam discovered in India, and finish with an examination of the accusations against Ripple and why they are important.
Max’s Corner: Selling Bridges

Continue reading at Coinspeaker
Source: CoinSpeaker

QuadrigaCX: Late CEO Cotten’s spouse claims that he facilitated withdrawals using personal funds in 2018

In the latest QuadrigaCX update, late CEO Gerald Cotten‘s spouse, Jennifer Robertson claimed that Cotten poured his own money into the exchange to fund user withdrawals in 2018.
According to a statement released by Robertson, honoring of the private funds took place in 2018 when QuadrigaCX had a legal dispute with the Canadian Imperial Bank of Commerce [CBIC]. This dispute led to a massive $21.6 million in funds being frozen. Although Robertson admitted having no direct knowledge of how her husband operated the now-defunct exchange, she said,
“I believe Gerry had the best interests of the business in mind and cared for his customers.”
The monitor appointed by the Canadian Court, Ernst & Young [EY], is however, yet to verify the genuineness of the claims stated by Robertson.
Previously this month, the wife of the deceased CEO had demanded reimbursement of the money spent on legal and managerial processes.
The CEO was allegedly the only person who had access to the passphrase for the cold wallets of the exchange. The Canada-based exchange, which is still under creditors’ protection, hasn’t been able to access the $190 million in crypto assets of Bitcoin, Bitcoin Cash, Bitcoin Cash SV, Bitcoin Gold, Ethereum, and Litecoin, after Cotten’s death.
A Canadian court had later granted QuadrigaCX, a 45-day extension to recover the missing crypto assets, accounting for nearly $190 million. The next hearing is scheduled for April 18, before which the creditors cannot charge the exchange legally.
The post QuadrigaCX: Late CEO Cotten’s spouse claims that he facilitated withdrawals using personal funds in 2018 appeared first on AMBCrypto.
Source: AMB Crypto

Possible Bitcoin [BTC] scam: BCSC warns Canadian Bitcoin exchange promising unrealistic investment returns

Canada’s regulatory agency, the British Columbia Securities Commission [BCSC], issued a warning against a suspicious trading platform, Canada Bitcoin Exchange Inc. [CBE]. The platform was offering excessively attractive investment plans with exponential gains, and subsequently came under the BCSC’s radar recently.
Source: Canada Bitcoin Exchange
The investment returns for all the four plans listed on the website were based on High Yielding Investment Programs [HYIP], which offered extraordinarily high investment returns. The exchange purported 3,586% returns in 48 hours and 7,985% returns in a mere 24 hours. The platform accepted payment mainly in Bitcoin [BTC], implying that recovering the assets would be very difficult in case of fraud.
Canada’s financial watchdogs confirmed that the suspicious entity was not registered to trade in British Columbia. The Commission further urged people to exercise caution while dealing with platforms similar to the one in question.
Another interesting aspect about the platform’s website was that apart from a basic Customer Support section, there was no mention of any licenses granted by any recognized regulatory body. Following the discovery, the BCSC reportedly found out that CBE was an unregulated organization.
Despite many in the online crypto community speculating that CBE might be a scam or a fraudulent organization, it is still not evident whether the platform did dupe investors. Two blockchains associated with the Bitcoin address provided on CBE’s website were identified on the Bitcoin block explorer service, Blockchain.com. Both these aforementioned addresses had recorded zero transactions.
Source: Blockchain.com
For the BCH address,

Source: Blockchain.com
According to domain search portal Who.Is, and newsBTC, the exchange was registered under the domain, NameSilo, LLC. It was further reported that the account was created after 1 August, 2017.
Source: Who.Is
Off late, crypto-platforms and exchanges have flocked to places with crypto-friendly regulations such as Malta and Switzerland, following the massive scrutiny and institutional challenges and warnings associated with trading in the US and Canada.
In the past three months alone, around 40 regulatory bodies in the US and Canada have issued cautionary alerts, urging investors to do their homework before dealing with any crypto-platform.
NASAA [North American Securities Administrators Association] President and Alabama Securities Commission Director, Joseph P Borg, had this to say in August 2018,
“State and provincial securities regulators are committing significant regulatory resources to protect investors from financial harm involving fraudulent ICOs and cryptocurrency-related investment products and also are raising awareness among industry participants of their regulatory responsibilities.”
The post Possible Bitcoin [BTC] scam: BCSC warns Canadian Bitcoin exchange promising unrealistic investment returns appeared first on AMBCrypto.
Source: AMB Crypto

Winklevoss’s Twin Conviction Towards Bitcoin Becomes Stronger Than Ever

Billionaire Bitcoin Investors and founders of Gemini Trust, Tyler and Cameron Winklevoss, recently addressed the on-going issues related to ‘protection of cryptocurrency wallets’ and ‘delayed regulations.’
‘Carcasses on the road of Crypto’
The security, feasibility of access and regulatory approval around an asset class, determines the FUD (Fear, Uncertainty, and doubt) characteristics around the pattern. Bitcoin was conceived to address the problem of centralized banking which holds controls over the funds of their customers.
However, ever since the Mt. Gox hacks in2011, it became apparent that the exchange which holds the private key for their customers are no different than the banks which act as custodians of their user’s funds. Recently, eight years after the hack, and numerous frauds and Ponzi schemes the demons of centralized exchange have come to surface with the QuadrigaCX issue.
The sudden death of the CEO of the Canadian Exchange, who was the sole holder of the private keys of the exchange’s cold wallet has unfortunately locked the funds of thousands of users. The total amount of the funds secured in cold wallets is approx $190 million.
“There are a lot of carcasses on the road of crypto that we’ve seen and learned from,” Cameron Winklevoss said Friday at the South by Southwest conference in Austin, Texas. “At the end of the day it’s really a trust problem. You need some kind of regulation to promote positive outcomes.”

“With a #crypto address and a smartphone, all of a sudden you are in the system. We are really just trying to extend the financial system, so you can send dollars anywhere in the world.” Our President Cameron @winklevoss on reaching the 1 billion people who unbanked #SXSW2019 https://t.co/VZk9fxwayQ
— Gemini (@Gemini) March 9, 2019

Not Deterred from their Original Goal 
Winklevoss Twins support cryptocurrency and eventually found the Gemini Trust to provide an efficient payment system to the 1 billion ‘non-banked’ people of the world.
“With a crypto address and a smartphone, all of a sudden you are in the system,” he said. “We are really just trying to extend the financial system, so you can send dollars anywhere in the world.”
However, the systems around the blockchain and cryptocurrencies which are the end providers of access to Blockchain including Bitcoin must be diligently designed to address unforeseen circumstances as well. The community has suggested that multi-signature wallets and personalized education around public and private keys is the best way to go.
The twins also reaffirmed their conviction towards the revolutionary economic system,
“You want to have a couple of layers of checks and balances,” Tyler Winklevoss said. “We are here for the long haul.”
The post Winklevoss’s Twin Conviction Towards Bitcoin Becomes Stronger Than Ever appeared first on Coingape.
Source: CoinGape

QuadrigaCX: Redditor claims exchange used to trade against its customers without assets to back them

Earlier this year, QuadrigaCX, a Canadian exchange had grabbed headlines after the untimely death of its CEO, which led to a large amount of funds becoming inaccessible. The exchange is now back in the news after allegations of trading against its own customers.
The exchange became a common name in the crypto-space after it claimed to have lost access to its cold wallets after CEO Gerald Cotten’s death. It was claimed that Cotten alone had access to these cold wallets, following which the exchange faced a loss of $190 million, owned by around 115,000 customers.
Adding fuel to the fire, a Reddit user, theSentryandtheVoid, alleged that the exchange used to trade against its own customers on social media. The Redditor stated that the exchange created fake accounts, which were then used to trade against its own customers. More so, these trades were executed without any assets to back them.
The Redditor said,
“I haven’t seen anyone commenting on this yet, but this is probably the most incendiary information revealed from this whole sordid process to date. Even worse than shipping all the crypto to trade with on other exchanges, even worse than the cold wallet balances being 0.”
Source: Reddit
Public Information on Quadriga Fintech Solutions Corp | Source: Sedar
The Redditor’s claims were backed by a Cornell University Professor, Emin Gun Sirer, who said,
“Turns out that QuadrigaCX traded against its own users, and in the crypto world, this is seen as a totally normal thing that just happens at pretty much every exchange.”
–mv–another Redditor said,
“All possible ways to scam clients, create fake volumes and have more clients signup/deposit money in the exchange. This should be a criminal case/investigation and Interpol search for Gerald, assets freezing for all owners/co-founders and maybe close relatives.”
Barsoapguy, a Reddit user said,
“this is a par the course for a lot of exchanges .No one should be surprised by this …oh wait none of you ever bothered to do even the least bit of due diligence when it comes to crypto.”
Earlier this week, the exchange was in the spotlight again after the wife of the deceased CEO demanded repayment of $300k in court, citing legal and managerial costs. The exchange platform was also granted an extension of 45 days to recover the missing funds by the Nova Scotia Supreme Court Justice.
The post QuadrigaCX: Redditor claims exchange used to trade against its customers without assets to back them appeared first on AMBCrypto.
Source: AMB Crypto

Court Grants Quadriga Deadline Extension, $145M in Crypto Still in Limbo

A Halifax court has granted an extension to QuadrigaCX’s creditor protection deadline. The story of the now-defunct crypto exchange that has most gripped the space so far in 2019 is therefore set to continue.
According to court documents, QuadrigaCX’s CEO, Gerard Cotten, died with the only knowledge of how to access the firm’s crypto cold storage solution. There is an estimated $145 million missing, a large potion of which is owed to the exchange’s customers.
Quadriga Given a Month and a Half to Find Missing Crypto
Much talked-about digital asset exchange platform QuadrigaCX has been granted an additional 45 days worth of creditor protection. The decision was made by a Nova Scotia Supreme Court Justice, Michael Wood, earlier today.
Wood also approved the motion to allow for the appointment of a chief restructuring officer to oversee the now-insolvent firm. However, the Justice was keen to point out that said officer would need to be monitored by a court-appointed delegate to ensure that professional fees did not run up too high. This monitor is also to have access to transnational data stored with Amazon Web Services, which may help in finding the missing funds.
The decision to extend the creditor protection afforded to Quadriga may well be a response to the recent report by “Big Four” auditing firm, Ernst & Young. It states that the company had successfully identified six of the supposed cold storage wallets used by Quadriga yet they were largely empty. In fact, apart from one single payment of $500,000 into them, there have been no deposits made in any since April 2018.
According to Toronto-based news publication The Star, of the US$145 million total missing, over US$52 million is owed to Quadriga customers.
Quadriga users leaving funds on the exchange stand to lose out.
This has caused various theories to abound about the whereabouts of the money, particularly given some of the circumstances surrounding Cotten’s death. Firstly, the Quadriga CEO died in a part of India known for having “fake death mafias” – organised gangs who will take care of all the paper work needed to make someone vanish administratively. Many have therefore accused the late Cotten of exit scamming his way out of Quadriga.
More recently, allegations have been made that the funds are in fact sitting on several large exchanges, including: Poloniex, Kraken, and Bitfinex. Research leading to this conclusion was published on the Zerononcense Blog.
However, Kraken CEO Jesse Powell refuted this narrative, whilst also reminding those who have lost funds thanks to the Quadriga missing keys debacle that the best chance of them getting their money back was if the money was indeed resting in a couple of exchange accounts.
Powell has himself been particularly active in the hunt for the Quadriga millions. The CEO even pledged to gift $100,000 in either cryptocurrency or fiat to whoever could give meaningful information leading to the recovery of the missing money.
 
Related Reading: QuadrigaCX Imbroglio Continues: Cotten Mentioned Bitcoin Key Loss In 2014
Featured Images from Shutterstock.
The post Court Grants Quadriga Deadline Extension, $145M in Crypto Still in Limbo appeared first on NewsBTC.
Source: New feedNewsBTC.com

Is Bitcoin (BTC) Sliding in Response to QuadrigaCX Disappointment?

Bitcoin prices down 2.2 percent
Five of the six QuadrigaCX cold wallets are empty
Transactional volumes drop, demand could see participation pick up to above 37k

Even with Bitcoin (BTC) liquidation, bulls have the upper hand as long as prices are trending above Feb 18 low. In that case, risk-off traders may search for entries in lower time frames and take advantage of positive fundamentals.
Bitcoin Price Analysis
Fundamentals
There is another burden that controls tags along—that of securing private keys. In centralized exchanges, wallets can be compromised—many have lost customers’ fund. Because customers have no access to the private keys of those public addresses, once lost—or controller disappears or dies with them, your coins will be gone—unless of course there are countermeasures. It’s the unfortunate case that happened at QuadrigaCX. With the passing of Cotten, $190 million of digital assets are now locked up. Worst case scenario, they are probably irrecoverable.
Of the $190 million, customers stand to lose a cumulative 26,500 Bitcoins. Since QuadrigaCX is under customer protection and Ernst & Young tasked with monitoring, Bloomberg reports that they have identified the addresses of six cold wallets.
Unfortunately, of the six, five are empty. It’s even getting thicker because the sixth “appears to have been used to receive Bitcoin from another cryptocurrency exchange account and subsequently transfer Bitcoin to the QuadrigaCX hot wallet.”
The account was the source of last month’s inadvertent transfer of Bitcoins sparking speculations that Cotten may, after all, be alive and kicking after faking his death while traveling in India.
Candlestick Arrangements

When everything is said and done, it will be easy to note that BTC/USD is consolidating. While prices are down 2.2 percent in the last day, the world’s most valuable coin is stable in the previous week. It is down 0.5 percent. That means bears have been unsuccessful in their dump down. Encouragingly, Bitcoin bulls stand a chance.
From candlestick arrangements, our previous BTC/USD trade plan is valid. Note that sellers are yet to reverse gains of Feb 18. After two weeks of lower lows, we expect a shift in momentum as BTC demand pick up reflecting increasing volumes over the course of last months.
As it is, risk-off, aggressive type of traders can buy on dips with targets at $4,500. Accompanying these longs will be tight stops at Feb 18 lows of around $3,750-$800—our breakout level.
Technical Indicators
Like before, our analysis anchors on Feb 18 bulls where bulls are in control. As visible, volumes are shrinking, and with averages at 12k, BTC demand could help yank prices from current lows to $4,500. The spring in interest should be at the back of high trading volumes exceeding Feb 18’s 37k.
The post Is Bitcoin (BTC) Sliding in Response to QuadrigaCX Disappointment? appeared first on NewsBTC.
Source: New feedNewsBTC.com

New Evidence Surface: Here’s How Kraken, Bitfinex and Poloniex Involved into QuadrigaCX Case

CoinSpeaker

New Evidence Surface: Here’s How Kraken, Bitfinex and Poloniex Involved into QuadrigaCX Case

It’s highly possible that QuadrigaCX CEO transferred a significant amount of platform’s Ethereum coins to other cryptocurrency exchanges’ storages.

New Evidence Surface: Here’s How Kraken, Bitfinex and Poloniex Involved into QuadrigaCX Case

Continue reading at Coinspeaker
Source: CoinSpeaker

QuadrigaCX Auditor: Most of $150m in Lost Crypto Has Been Drained, What Does This Mean for Investors?

The QuadrigaCX imbroglio took a turn yesterday when Big Four Auditing Firm, Ernst & Young (EY) released its “Third Report of the Monitor” that asserts that they have identified six separate crypto wallets were used to store the exchange’s cryptocurrency.
Unfortunately for embattled QuadrigaCX investors, the wallets did not contain any of the nearly $150 million in cryptocurrency that is still missing following the death of the exchange’s CEO, and the hunt for this missing crypto will continue on.
Ernst & Young: There Have Been No Deposits into QuadrigaCX Crypto Cold Wallets Since April 2018 
Aside from one inadvertent transfer into one of the wallets totaling at under $500,000, the report claims that there have been no deposits into the wallets since April of last year.
“To date, the Applicants have been unable to identify a reason why Quadriga may have stopped using the Identified Bitcoin Cold Wallets for deposits in April 2018, however, the Monitor and Management will continue to review the Quadriga database to obtain further information,” the report explained.
Importantly, besides a small fraction of cryptocurrency remaining in the addresses, there is still well over $100 million worth of customer’s crypto still missing.
Furthermore, EY noted that they have thus far been unable to discover why the six wallet addresses had stopped being used by the exchange, but that they would continue to review their data sources in order to garner more info on where the funds were being directed to.
“The Monitor has made inquiries of the Applicants as to the reason for the lack of cryptocurrency reserves in the Identified Bitcoin Cold Wallets since April 2018. To date, the Applicants have been unable to identify a reason why Quadriga may have stopped using the Identified Bitcoin Cold Wallets for deposits in April 2018, however, the Monitor and Management will continue to review the Quadriga database to obtain further information.”
Ernst & Young did not discuss whether or not they know about any existing wallet addresses outside of the six aforementioned ones, and also did not discuss whether or not there are any cold storage addresses holding cryptocurrency besides Bitcoin.
Could the Missing QuadrigaCX Funds Be Held on Various Crypto Exchanges?
Recently, a research report published on the Zerononcense Blog claimed that they have identified the wallet addresses where the exchange was keeping their Ethereum, and that there is a “strong possibility” that there may be a significant amount of ETH being held on some major cryptocurrency exchanges, including Poloniex, Kraken, and Bitfinex.
According to the report, there may be over 600,000 ETH being held in wallets on these exchanges, and that the now defunct exchange’s deceased CEO – Gerry Cotton – may have been moving the ETH to these exchanges while QuadrigaCX was operational.
“Based on the transaction analysis included in the report, it appears that a significant amount of Ethereum (600,000+ ETH) was transferred to these exchanges as a means of ‘storage’ during the years that QuadrigaCX was in operation and offering Ethereum on their exchange… it is very possible that QuadrigaCX, the creditors, and other entities are unaware of this discovery,” the Zerononcense Blog report explains.
Jesse Powell, the co-founder and CEO of Kraken, responded to the report on Twitter, explaining that none of the aforementioned funds are being stored on Kraken, and further adding that the possibility of these funds being held on exchanges is the “best hope that QCX clients have” of ever retrieving their lost funds.
“This is the best hope that QCX clients have — that Cotten was keeping client funds in other exchanges. Unfortunately, nothing at Kraken. Hopefully, others are looking. Could be accounts were created under different names so might take some real digging to find.”

This is the best hope that QCX clients have — that Cotten was keeping client funds in other exchanges. Unfortunately, nothing at Kraken. Hopefully, others are looking. Could be accounts were created under different names so might take some real digging to find.
— Jesse Powell (@jespow) March 1, 2019

Powell has been highly involved in the whole imbroglio since it first began, and Kraken just recently announced a $100k bounty for any information leading to the discovery of the missing funds.
“Kraken is giving up to $100,000 USD (fiat or crypto) as a reward for the tip(s) that best lead to the discovery of the missing $190 million US dollars. Can you help us unravel the Curious Case of Cotton’s Coins?” The exchange announced in a recent tweet.

Kraken is giving up to $100,000 USD (fiat or crypto) as a reward for the tip(s) that best lead to the discovery of the missing $190 million US dollars. Can you help us unravel the Curious Case of Cotton's Coins?https://t.co/BurmEMKVku
— Kraken Exchange (@krakenfx) February 28, 2019

The entire crypto community will continue sitting at the edge of their seats as the situation relating to the status and whereabouts of the missing funds continues to unravel, but at this time the best hope for investors affected by the situation is likely that the missing funds are scattered about on various cryptocurrency exchanges.
NewsBTC will continue to bring you the latest developments relating to the QuadrigaCX situation.
Featured image from Shutterstock.
The post QuadrigaCX Auditor: Most of $150m in Lost Crypto Has Been Drained, What Does This Mean for Investors? appeared first on NewsBTC.
Source: New feedNewsBTC.com

QuadrigaCX’s cold wallets are untouched since April 2018, says E&Y Report

Ernst & Young, one of the big four financial audit giants and court-appointed independent third-party supervisor of the legal and financial controversy-riddled Canadian cryptocurrency exchange QuadrigaCX, released their “Third Report of the Monitor,” which revealed vital information about the exchange’s missing cold wallets.
The audit giant identified six cold wallet addresses, which QuadrigaCX operated in the past to store Bitcoin [BTC] labeled, “Identified Bitcoin Cold Wallets.” Furthermore, E&Y also identified three other wallet addresses labeled “Potential Other Cold Wallets,” which were later invalidated by the auditor as being empty.
In a four-year period, i.e. from April 2014 to April 2018, the BTC balances in the Identified Bitcoin Cold Wallets ranged from the minimal to zero. One exception was when the wallet held 2,776 BTC. The average balance at the end of every month over the aforementioned time period was 124 BTC. The report also said that the Bitcoins in the Identified Bitcoin Cold Wallets were transferred out completely in April 2018.
Since then, no deposits were recorded in the Identified Bitcoin Wallets. An exception, however, was when BTC worth $500,00 was “inadvertently transferred” into the sixth wallet. However, information about the same was previously disclosed by the applicant.
The last transaction from the sixth wallet was recorded on 3 December 2018. E&Y claimed that cryptocurrency exchanges could have been the recipients of some of the Bitcoins in the aforementioned wallets, referring to them as “identifiable cryptocurrency exchanges.”
E&Y report stated,
“To date, the Applicants have been unable to identify a reason why Quadriga may have stopped using the Identified Bitcoin Cold Wallets for deposits in April 2018, however, the Monitor (E&Y) and Management will continue to review the Quadriga database to obtain further information.”
Following the release of this report, E&Y will now look into the exchange’s hot wallet balances to investigate the location of the missing cryptocurrencies.
Since the untimely death of its founder, Gerald Cotten, the exchange’s operations have been in limbo. In early February, the exchange filed for creditor protection, following which E&Y was appointed to oversee operations.
The only information about the location of the wallets came from a five-year-old podcast, in which Cotten stated that the private keys were stored offline in a bank, in the company’s safe deposit box. However, no concrete information about the same has surfaced.
Recently, another cryptocurrency exchange Kraken offered a helping hand to QuadrigaCX, promising a reward of $100,000 in fiat and cryptocurrency to anyone who provided reliable information leading to the retrieval of QuadrigaCX’s cold wallets.
The post QuadrigaCX’s cold wallets are untouched since April 2018, says E&Y Report appeared first on AMBCrypto.
Source: AMB Crypto

Kraken to reward $100,000 for solid information on QuadrigaCX’s missing funds

Kraken, the San Francisco-based cryptocurrency exchange, is offering to help the controversy-riddled Vancouver-based QuadrigaCX, with a reward of $100,000 to anyone who provides information that can lead to the discovery of the Canadian exchange’s missing funds. Additionally, this information would be passed on to law enforcement agencies.
Announced via an official blog post on February 28, Kraken stated that an entire industry was affected when a single cryptocurrency exchange ceased their operations, locking up their user’s funds. Kraken likened the situation to that of the Tokyo-based Mt. Gox. The Japanese exchange, which was once the largest Bitcoin [BTC] exchange in the world, but is now bankrupt and defunct. Kraken further added:
“Since 2014 we have invested significant resources and lent our crypto expertise to the Mt. Gox trustee and investigators, supporting the return of as much client funds as possible and as soon as possible.”
Kraken’s intent behind the announcement was stated to be,
“Kraken wants to bring awareness and attention to this case, in hopes that we can help discover some or all of the missing client funds.”
In December 2018, QuadrigaCX’s founder, Gerald Cotten, passed away while on a trip to India and since then, the company’s operations are in limbo. The exchange suspended operations on January 26 and announced that it lost control of their cold wallets, where most of their assets were kept as Cotten was the only one that knew its location.
The cold wallets, according to some estimates, are valued at $190 million and belong to as many as 115,000 clients.
QuadrigaCX mysteriously went offline towards the end of January, citing maintenance issues, which were further amended by the board to state “significant financial issues.” A Canadian court even appointed the global audit giant Ernst & Young Inc. as an independent third party to supervise the creditor protection protocol.
Kraken hopes that its new announcement will bring to light information very similar to the one unearthed by an old podcast that was in the news recently. In the 2014 “True Bromance,” podcast, Cotten revealed that information may be stored on paper in a safety deposit box. He added,
“Essentially, we [QuadrigaCX] put a bunch of paper wallets into the safety deposit box, remember the addresses of them. So, we just send money to them, we don’t need to go back to the bank every time we want to put money into it. We just send money from our Bitcoin app directly to those paper wallets, and keep it safe that way.”
The post Kraken to reward $100,000 for solid information on QuadrigaCX’s missing funds appeared first on AMBCrypto.
Source: AMB Crypto