As per the reports from CryptoNewsZ, the funds of the cryptocurrency exchange QuadrigaCX of the death of the CEO of the crypto exchange raised a question on the access of the 190 Million dollars/ 250 million CAD because the CEO did not leave any clue of the password to this amount. Cotten’s wife filed an affidavit in January this year that the crypto exchange has no access to its wallets. Unfortunately, Gerald Cotten has not left any evidence of any passwords. QuadrigaCX CEO’S death had an impact on 115,000 users of the exchange.
But lately, there has come another twist in the case. The funds that were till now perceived as stuck; as per an analyst from the Wall Street Journal, there is a possibility that they are actually missing.
For this case, the Supreme Court will be requested to appoint the ‘Big Four’ auditing firm- ‘Ernst and Young.’ The firm will act as an independent third party and will be supervising all the proceeding related to the case. The announcement read as follows-
An application for creditor protection in accordance with the Companies’ Creditors Arrangement Act (CCAA) was filed today 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. The Court is being asked at a preliminary hearing on Tuesday, February 5 to appoint a monitor, Ernst & Young Inc., as an independent third party to oversee these proceedings.
For the past weeks, we have worked extensively to address our liquidity issues, which include 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, as well as sourcing a financial institution to accept the bank drafts that are to be transferred to us. Unfortunately, these efforts have not been successful. Further updates will be issued after the hearing.”
The crypto exchange’s users have obviously grown doubtful and anxious around the case proceedings. As per reports from Bloomberg, 12 days before his death, Cotten filed a will in November last year. This will made his wife as the only beneficiary and the executor of his estate.
One of the analysts of Zerononcense- James Edward, on finding no proof of the exchange has any control over the wallets it ‘claims’ to possess. He further added, “It appears that there are no identifiable cold wallet reserves for QuadrigaCX.” Although he says that at one time there were wallets with big balances, but at present, they are quite low. At the moment the largest wallet is a hot wallet.
The doubts are not coming only from Edward, but also from other market experts and former corporate. For instance, the CEO of Elementus Group- Max Galka said that there are chances that there are no cold wallets. Similarly, the CEO of the crypto exchange Kraken- Jesse Powell posted on Twitter on 2nd Feb, that he thinks the story (of QuadrigaCX) is “bizarre and, frankly, unbelievable.” He further suggested the police to contact Karken because there are a number of wallet addresses that are known to belong to QuadrigaCX.
On the other hand, as per the British Columbia Securities Commission (BCSC), QuadrigaCX does not fall under BCSC’s regulatory scope of influence.