$190M In Crypto Lost As Exchange Founder Dies With Only Password

Gerald Cotten dead or not

A visual representation of the digital cryptocurrency, bitcoin.

Investors in QuadrigaCX, Canada's largest cryptocurrency exchange, were unable to access their funds after its founder, Gerald Cotten, died previous year.

Cotten's widow, Jennifer Robertson, has filed for creditor protection, saying that the firm can not access coins in "cold storage", Coindesk reports. The company announced his death more than a month later, posting on Facebook that Cotten died due to "complications with Crohn's disease on December 9, 2018 while travelling in India, where he was opening an orphanage to provide a home and safe refuge for children in need".

To try and buy time to access the laptop and possibly to liquidate the company, QuadrigaCX has applied for a stay of proceedings from the Supreme Court. According to an affidavit from Cotten's wife, Jennifer Robertson (via Coindesk), the exchange holds 26,500 Bitcoins, 11,000 Bitcoin Cash, 11,000 Bitcoin Cash SV, 35,000 Bitcoin Gold, 200,000 Litecoin, and 430,000 Ether - presumably all residing on that single laptop. The company had no corporate bank accounts and used third party services to manage payments and withdrawals.

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"For the past weeks, we have worked extensively to address our liquidity issues, which include attempting to locate and secure our very significant cryptocurrency reserves held in cold wallets, and that are required to satisfy customer cryptocurrency balances on deposit, as well as sourcing a financial institution to accept the bank drafts that are to be transferred to us", the company said via a statement on its website. Unfortunately, these efforts have not been successful'.

About $190m in cryptocurrency has been locked away in a online black hole after the founder of a currency exchange died, apparently taking his encrypted access to their money with him. She said she had also received threats and slanderous comments.

In fact, there's reportedly $190 million United States locked up within encrypted drives belonging to a recently deceased Canadian crypto exchange owner. Nor can Vancouver-based Quadriga CX pay the $70 million in cash they're owed.

According to a report by CoinDesk, a court filing suggests that crypto exchange owes $250 million CAD as most of the funds were kept in a cold wallet (a physical device that isn't connected to the internet) which could be accessed only by Gerald. A hearing is scheduled for Tuesday, and Ernst & Young has been chosen as a proposed monitor.

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