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Canadian Court Grants QuadrigaCX 45-Day Extension to Recover Crypto Assets

Canadian Court Grants QuadrigaCX 45-Day Extension to Recover Crypto Assets

The Supreme Court of Canada granted QuadrigaCX a 45-day extension to recover cryptocurrency assets that went missing after its founder’s death, keeping the exchange safe from creditor lawsuits while the investigation continues into the loss of $190 million in crypto.

QuadrigaCX Receives Extension

Following the death of its founder and CEO back in Dec. 2018, Canadian exchange QuadrigaCX has been embroiled in a three-month-long court battle. The exchange, which had filed for creditor protection at the end of January this year, has been under said protection since Feb. 5th.

Source: QuadrigaCX

And now, a Canadian court granted the exchange a 45-day extension to recover the crypto assets that went missing. According to the Globe and Mail, the reprieve was granted by Michael Wood, the Nova Scotia Supreme Court Justice. Ernst & Young, one of the big four auditing firms, has been tasked with screening the exchange’s data that is currently stored on an Amazon Web Services’ cloud. The auditor will be represented by Stikeman Elliott, a leading law firm in Canada.

The Supreme Court Justice also appointed a new Chief Restructuring office to work under the direction of Ernst & Young. Peter Wedlake, a senior vice president at Grant Thornton, will be taking the position.

US and Canadian Authorities Launch a Joint Probe into Missing $136 Million

The 45-day extension will give QuadrigaCX some breathing room while the investigation into the funds missing from its accounts continues. According to Fortune, the Federal Bureau of Investigation and the Royal Canadian Mounted Police are both said to be involved.

Following the mysterious death of Gerald Cotten, the founder of QuadrigaCX, in Dec. 2018, the access to over $190 million in cryptocurrency funds was allegedly lost. The exchange’s employees claimed that about $137 million of those funds were held in cold storages, the keys to which were reportedly only known to Cotten.

However, after weeks of speculation about the location of the funds and Cotten’s mysterious death, the exchange’s court-appointed auditor Ernst & Young was able to gain access to Cotten’s accounts.

According to an EY report from Mar. 1st, the accounts were reportedly emptied in Apr. 2018, eight months before Cotten’s death. Apart from that, investigators also found that the exchange kept “limited books and records” and had never reported its financials.

Jesse Powell, the CEO of Kraken, told Fortune in an interview that both the FBI and the Royal Canadian Mounted Police have been in touch with him regarding the investigation.

He said that it was very unlikely that Cotten ever transferred the $136 million in funds to cold storage wallets. Instead, he believes that the missing Quadriga funds were moved to hot wallets on other exchanges. And, as one of the exchanges believed to be storing some of Quadriga’s funds, he may have leeway to speculate. To aid his search, Powell announced a $100,000 reward for information that leads to the location of the missing funds.

Filed Under: , Crypto Exchanges, Hacks
Priyeshu Garg

Priyeshu is a software engineer who is passionate about machine learning and blockchain technology. He holds an engineering degree in Computer Science Engineering and is a passionate economist. He built his first digital marketing startup when he was a teenager, and worked with multiple Fortune 500 companies along with smaller firms. When he is not solving the transportation problems at his company, he can be found writing about the blockchain or roller skating with his friends.

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