QuadrigaCX Secures 30-Day Protection against Lawsuits

QuadrigaCX, which caused panic by closing its site on January 28, received creditor protection and a stay on proceedings while an investigation is under way.

QuadrigaCX, the Canadian exchange that claimed insolvency after the death of its founder two months ago, was granted creditor protection and a month-long stay of proceedings, Canadian media reported.

With 115,000 traders hurt in the recent insolvency crisis, the company may be attacked by lawsuits, and the court decision is a way to diffuse the tension. QuadrigaCX lawyer Maurice Chiasson described the move as “an attempt to call a time-out.”

In the meantime, the Nova Scotia police force has begun investigating the case.

QuadrigaCX has been widely used in the crypto community, mostly for arbitrage. As new user stories keep surfacing, it turns out the exchange resorted to wire transfers to get fiat on board, using offshore bank accounts and even a bank in Poland to service the requests. This approach is similar to what Bitfinex did for a short time after losing its servicing bank.

The Reddit community is also extremely active in discovering new facts about the death of Gerald Cotten, 30, who passed away in India on December 9. A suggestion has been made to start a private investigation on the ground in India.

Additional doubts were raised by the fact that Cotten only filed for a personal will 12 days before his death. Dated November 27, the will leaves all assets to Robertson, Bloomberg reported. However, Cotten had failed to include access to any wallet addresses. At this time, neither Quadriga nor independent research has shown any actual addresses on the Ethereum or Bitcoin networks, which hold the alleged coin deposits. This leads to the conclusion that the project may already have been insolvent, with evidence of sending some of the coins to other exchanges.

The QuadrigaCX case is rife with doubts and disparities, and private users are coming up with additional research. It is currently unknown which of the newly appearing documents are real, such as, for example, a misspelled death certificate or bank documents circulated on Twitter.

https://twitter.com/JackJulian/status/1092808113445572615

For now, the only certain thing is QuadrigaCX’s recent official statement outlining the protection under Ernst & Young, with no details on digital asset wallets or other funds.

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