Quadriga: Cryptocurrency exchange founder's death locks $140m

Quadriga: Cryptocurrency exchange founder's death locks $140m

Cotten, whose sudden death left C$190 million ($145 million) in Bitcoin and other digital assets protected by his passwords unretrievable, signed his last will and testament on November 27, 2018.

Gerald Cotton - boss at QuadrigaCX - was the only member of the company who had the password but died last December.

Robertson wrote that her husband's laptop is encrypted and that she nor other consultants have been able to recover its contents. The reason for the lost money this time is perhaps even stranger: only one person knew the company's password, and he died.

Quadriga CX's directors posted a notice on the firm's website on Jan 31 that it was asking the Nova Scotia court for creditor protection while they address "significant financial issues" affecting their ability to serve customers.

"Unfortunately, these efforts have not been successful, " the board, however, noted.

The company revealed that Cotten had unexpectedly died on December 9, 2018, of complications arising from Crohn's Disease while he was traveling in India.

The CEO's widow Jennifer Robertson has also said that she doesn't have access to any of these accounts and that the laptop, which Cotten used for the exchange, is encrypted.

Ironically, it appears that Cotten's worries about security - understandable given the high-profile hacks that have bedeviled other exchanges - led to the locking away of all that crypto.




Its possible that the key to unlocking QuadrigaCX's cold storage system could be contained within the company's business documents, which may have a description and record of its systems.

Quadriga's "cold wallets" contain inaccessible assets belonging to around 115,000 customers, according to Robertson's court filings.

"Quadriga was unable to access the cold wallets and/or discovered that the cold wallets contained minimal cryptocurrency units", it said in court filings. "Despite repeated and diligent searches, I have not been able to find them written down anywhere", she said.

She said all attempts to bypass its encryption, including hiring a technical expert, have proved futile.

It is understood that save for some money in what is effectively a petty cash drawer, virtually all of the exchange's funds are locked up, meaning customers are unable to withdraw their dosh, practically speaking.

However, Quadrigas access to cash has been “severely compromised” by its inability to negotiate bank drafts provided by the payment processors.

"Transfers from the cold wallet to the hot wallet would occur when the hot wallet was running low and withdrawals were being sent to users", the affidavit says.

Also surfacing on Tuesday, via CoinDesk, was the first public copy of what's said to be Cotten's death certificate.

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