The current situation of the defunct exchange QuadrigaCX is just like a thriller movie as cryptocurrency enthusiasts around the world are curious to know what exactly has happened and what was the exchange up to. It was in the news recently that Ernst & Young, one of the top auditing and law firms in the world had revealed that QuadrigaCX’s cold storage wallets had almost NIL amount of user funds. This was quite shocking for the people who had millions of their investment or trading funds on the exchange as they were not hoping for this.
QuadrigaCX: A Shocking Turn
The situation gets even worse now as the widowed wife of Gerry Cotton, the dead co-founder, and CEO of QuadrigaCX exchange claims that her husband used to mix his own money with the exchange’s funds in order to fulfill customer withdrawals. According to Gerry’s wife, she does not know exactly how Gerry used to operate his business/exchange, however, he used to tell her that he had to keep transferring his own personal money into Quadriga CX exchange to fund the user withdrawals last year.
The statement of the widowed wife came into the picture soon after Ernst & Young revealed that the cold storage wallets of the exchange were nearly empty. A report also claimed that the exchange’s funds (around 600,000 ETH) were stored on different exchanges namely Kraken, Bitfinex, and Poloniex, after being transferred from the cold wallets.
The situation got worse long before the death of Gerry Cotton:
The situation had got worse long before the death of the CEO of QuadrigaCX, Gerry Cotton. The company was already in huge trouble and also is facing a legal battle with a bank. The CEO had to fund the exchange withdrawals using his own personal savings which may be because the holdings of people were being spent on personal expenses previously or had been lost on gambling or other activities. This is not confirmed and yet to be known. However, the people drew attention to the QuadrigaCX case only after the death of the CEO this year.
Is there a Change of Recovery?
If the CEO of QuadrigaCX, Gerry Cotton had really transferred the cold wallet funds onto other cryptocurrency exchanges as being reported earlier, and the auditors are able to track these fund’s transactions, there might be a chance for the victims to get their funds recovered, either fully or partially.