The $145 million that was allegedly stuck in QuadrigaCX crypto exchange that we reported in our crypto news a few days back turn out to be actually missing according to an analysis referred to in the Wall Street Journal.
As it turns out, the founder of the major Canadian exchange Gerald Cotten who passed suddenly was the only executive with the access to all of the cold wallets of the exchange. The customers are since unable to withdraw funds and now the exchange asks for protection in a Canadian court.
The auditing firm Ernst & Young stated that the exchange was not able to access the cold wallets that actually contained minimal crypto units. Later the company was appointed as an independent third party to monitor the proceedings.
Cotten filed a will only 12 days before he died and designated his wife as the only beneficiary and executor of the entire estate.
Crypto analyst James Edwards reviewed all of the publicly available transactions of the exchange and couldn’t find evidence that the exchange controlled the wallets which he later wrote in a post:
“It appears that there are no identifiable cold wallet reserves for QuadrigaCX.’’
Edwards suggests that wallets with larger balances seem to have existed and the largest one is a hot wallet which is used for transactional purposes. Other experts such as Kraken CEO Jesse Powell tweeted how the story was bizarre and unbelievable.
The British Colombia Securities Commission stated that the QuadrigaCX exchange doesn’t go under the commission’s regulatory framework and that the exchange was unregulated because there wasn’t a sign that the exchange-traded securities.
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