E&Y Finds QuadrigaCX Wallet Empty, Inactive for Months
During its official investigation, the auditor in the QuadrigaCX case has failed to discover the funds supposedly held by the defunct Canadian exchange.
There are no funds in the wallets belonging to QuadrigaCX, and the addresses have not been used since April 2018, as revealed by auditor Ernst & Young (E&Y) in its latest report on the case. The Canada-based exchange supposedly lost between $140 million and $190 million in Bitcoin (BTC), Ethereum (ETH), and Litecoin (LTC), and speculation continues on the actual addresses, the balances, and the technique used for storing the funds safely.
As the designated monitor on the case, E&Y received six most probable addresses and went on to check balances and activity, aiming to discover if QuadrigaCX held BTC in cold storage, as suggested. E&Y also pointed out that by the date of the third report, no other probable addresses had been identified as the central wallets. The investigation continues, with a few other addresses proposed that still hold no balances, according to the report.
The monitor’s discovery shows that the likely cold wallets of the exchange have been emptied months ahead of the closing and long before the death of QuadrigaCX founder Gerald Cotten. The report states:
“From April 2014 to approximately April 2018, aggregate bitcoin month end balances in the Identified Bitcoin Cold Wallets ranged from a low of nil to a peak of approximately 2,776 bitcoin. The average aggregate month-end balance over the four-year period was approximately 124 bitcoin. In April 2018, the remaining bitcoin in the Identified Bitcoin Cold Wallets was transferred out bringing the balances down to nil.”
A sixth wallet address remained active, with the last transactions recorded on December 3, 2018. This one contains no balances as well.
The audit also concluded that some QuadrigaCX funds did end up on known, identifiable wallet addresses. It is not possible to immediately determine ownership, but E&Y stated it had reached out to exchanges in an attempt to trace the funds.
The auditor’s discoveries match the general conclusions of Zerononcense, which discovered activity in a handful of addresses potentially connected with QuadrigaCX. Tracking the transactions ultimately showed that some of the funds had reached Bitfinex, Kraken, and Poloniex.
However, no one has yet discovered addresses containing significant balances, as claimed in the affidavit by Cotton’s widow, Jennifer Robertson.