Canadian cryptocurrency exchange QuadrigaCX is in hot water: Following the sudden death of its 30-year-old founder, Gerald Cotten, the exchange has allegedly lost access to its cold wallets, where most of the funds were stored.
Now, the exchange has taken to court to avoid the collapse, but some community members suggest that QuadrigaCX's cold wallets never existed.
According to Cotten, QuadrigaCX was established against the backdrop of scarce crypto services in Canada.
In 2015, QuadrigaCX became the country's largest crypto exchange, with around $37.4 million traded on their platform - according to the company, it had acquired around 60 percent of the market share by November that year.
Despite claiming to be a compliant company, QuadrigaCX doesn't have a public office.
In March 2015, Quadriga Fintech - the exchange's parent company - announced its plans to go public and be listed on the Canadian Securities Exchange via a reverse initial public offering.
According to a CNBC article published in May 2014, QuadrigaCX held the majority of its assets in cold wallets - which are secured by digital security keys in order to protect them from hacking and theft - had advanced encryption, custom operating systems and software, and a partnership with CloudFlare, a large company in the United States that provides DDoS protection.
Several days later, on Jan. 31, QuadrigaCX filed for creditor protection in compliance with the Companies' Creditors Arrangement Act at the Supreme Court of Nova Scotia.
As a result, the exchange claims to have only CA$375,000 in cash, while it owes CA$260 million to as many as 115,000 of its customers, and hence is facing a liquidity crisis.
Robertson faces a backlash from the QuadrigaCX users on social media, who mostly took to Twitter and Reddit to question whether Cotten is actually dead. As per The Globe and Mail, the CCAA filings include a statement of death issued by J.A. Snow Funeral House in Halifax.
QuadrigaCX Is Filing for Creditor Protection Amid Liquidity Crisis, Community Remains Largely Skeptical
Published on Feb 5, 2019
by Cointele | Published on Coinage
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