Topic: Unofficial Quadriga Cx Thread - page 2. (Read 24377 times)

Few days to meeting

Update to Affected Users:

The purpose of this communication is to update Affected Users on the ongoing bankruptcy proceedings.

Please note that we have received notice from Ernst & Young Inc. that the Applicants’ bankruptcy proceedings under the Bankruptcy and Insolvency Act have commenced. A copy of the Order of the Court terminating the CCAA proceedings and authorizing the transition into bankruptcy can be found here (the “Bankruptcy Transition Order”).

Below are a few key highlights of the Bankruptcy Transition Order:

Although the bankruptcy proceedings have commenced, the CCAA proceedings will be formally terminated when the Monitor files with the Court a discharge certificate. Certain expenses need to be paid and the Monitor’s and its counsel’s and Representative Counsel’s fees need to be approved by the Court within the CCAA proceedings.
Ernst & Young Inc. will transition its role from Court-appointed Monitor to Trustee in Bankruptcy.
Grant Thornton Limited, as Chief Restructuring Officer, will be discharged as CRO once the Monitor files the discharge certificate.
The Representative Counsel Appointment Order, the Official Committee Appointment Order and certain other orders granted within the CCAA proceedings will continue to have effect in the bankruptcy proceedings.
At the first meeting of creditors in the bankruptcy proceedings, Representative Counsel will file an omnibus proof of claim on behalf of Affected Users for purposes of voting on the matters at the first meeting.
The first meeting of creditors is tentatively scheduled for May 2, 2019 at 10:00 a.m. (Halifax time).

Representative Counsel will continue to keep Affected Users apprised of relevant developments. For answers to commonly asked questions, please refer to our FAQ and updated FAQ sheets. Further information can be found about the proceedings at our website here.

Affected Users are encouraged to voice their concerns by tweeting to the Official Committee. Affected Users’ questions and comments will be forwarded by the Official Committee to Representative Counsel for compilation and answer via updated FAQs. The Official Committee’s twitter account (@QCXCommittee) can be found here

https://twitter.com/QCXCommittee

Here is our update about the QuadrigaCX case, also published on our twitter account:
https://twitter.com/whitestream5/status/1103091778100576256

Since EY lately discovered some of QuadrigaCX cold wallet addresses, we managed to analyze some of them.
Together with insights that we already extract from QuadrigaCX hot wallets, we can shed some light on QuadrigaCX Bitcoin transactions from the last six month.

The time period we checked was since July 2018 to February 2019, the average Bitcoin price at this time frame is around $5,700.
We saw that both QuadrigaCX cold and hot wallets sent around 5,571 BTC to a suspicious intermediary wallet at this time period.
We suspect that this wallet belongs to QuadrigaCX too.

QuadrigaCX hot wallet sent to the suspicious intermediary wallet 3,432 BTC, which is around $19,500,000 US.
QuadrigaCX hot wallet:
https://www.walletexplorer.com/wallet/000009200775868e/addresses

QuadrigaCX cold wallet sent to the suspicious intermediary wallet 2,139 BTC, which is around $12,200,000 US.
QuadrigaCX cold wallet:
https://www.blockchain.com/btc/address/1JZJaDDC44DCKLnezDsbW43Zf8LspCKBYP

The suspicious intermediary wallet:
https://www.walletexplorer.com/wallet/006daa655b240256/addresses

The suspicious wallet has interactions with more Bitcoin exchanges and not just from QuadrigaCX, but most of his incomes are from QuadrigaCX.
The suspicious wallet sent most of his funds to two Chinese exchanges, Huobi and Binance.

Around 1,176 BTC were sent to Binance, which is $6,700,000 US.
Around 5,263 BTC were sent to Huobi, which is $30,000,000 US.

Huobi wallet:
https://www.walletexplorer.com/wallet/Huobi.com-2

Binance wallet:
https://www.walletexplorer.com/wallet/0000011bd9c73aab/addresses

Thank you.
whitestream - Blockchain Intelligence
https://whitestream.io

Dang! Their shady activities is gradually being bust up and all is on negative side.If the wallet is already empty since last year then most likely this incident is really being planned.

That is the strangest thing I have seen in this case too.
https://ambcrypto.com/quadrigacxs-cold-wallets-are-untouched-since-april-2018-says-ey-report/
No funds were sent to these wallets? Then where were the funds for the customers sent to?
This case of quadrigacx just gets weirder and weirder with everything they come across.
Next thing they will find out Cottens whereabouts with him sun tanning in the bahamas.

https://www.bloomberg.com/news/articles/2019-03-01/quadriga-has-6-cold-wallets-but-they-don-t-hold-any-crypto?srnd=cryptocurrencies

More oddness. The much vaunted cold wallets appear to have been empty for quite some time. I guess this backs up Coinbase's theory that they'd been insolvent for quite some time and finally ran out of road.

'The manner in which they were sent is consistent with the theory posited in Jennifer Robertson’s affidavit that they were sent to these exchanges as a means of storage.'

So first he was boasting of his multi sig. Then he was paper wallet only. Then it was all under his sole control. And then this reveals he was using exchanges as a 'safe' place to store coins?

Was his mind slowly dying before his body did?

Here some updates related to QuadrigaCX

[Breaking!] Over 600k+ Ethereum Belonging to QuadrigaCX Has Been Found!
https://www.reddit.com/r/CryptoCurrency/comments/avwzce/breaking_over_600k_ethereum_belonging_to/

$100k reward offered by Kraken to find the money  ..........go go go  
https://qcxtips.com/

https://www.youtube.com/watch?v=GZvXqg5KyJM

Kraken have released this podcast series that covers their analysis of Quadrigacx. My connection is so hopeless here I can't get it to work. Maybe it'll enlighten someone.

This makes sense to what is going on with quadrigacx and this coming from one who owns one being coinbase pro.
So getting an observation from this viewpoint is exactly what the people who are still looking for answers to what happened and what is potentially going to happen to their funds and crypto they have locked up in this failed exchange.

That sounds about right to me.

I was hoping there would be some good blockchain analysis that might back up the fractional reserve theory. The circumstantial evidence -- especially when you consider the losses from the ETH smart contract bug and the ongoing delays in paying customers -- was already pretty strong.

I wonder if the owner really died or not. If so, I wonder why the other managers/directors thought they could hide the insolvency this way.

Brian Armstrong of Coinbase weighs in with their best guesses after a bit of analysis.

https://twitter.com/brian_armstrong/status/1098656491609849856

TLDR - they were a fractional reserve for quite some time, the bear market stopped the plates from spinning, they used the owner's death as an out.

Pretty interesting article 

https://blog.zerononcense.com/2019/02/16/report-shows-quadrigacx-cold-wallets-actively-involved-in-significant-criminal-activity-ties-to-silk-road-hacked-funds-identity-theft-and-drug-human-trafficking

The one who made the Gofundme page is Matthew Whitcomb, who has worked at both Coinsquare and the Romanian BTR Exchange funded on Bnktothefuture
They both serve Canadian clients I'll verify a real human behind this campaign.

On the part about subsidizing via gofundme true that.

I feel the orphanage in India needs it, the story of a lucrative crypto exchange owner going to a foreign country to fund an orphanage, spending ridiculous amounts of money on themselves and leaving behind an orphanage in crippling debt, feels like something that deserves sympathy.

https://bnktothefuture.com/pitches/bitcoin-romania

From Jack Jillian
The Game of Thrones Lawyers Edition is on standby until February 22nd
https://twitter.com/JackJulian


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The Globe and Mail went to investigate the orphanage Cotten sponsored and his death, the story verified he died.

Unless he went and faked his symptoms tricking doctors, then replaced himself with a body double it all adds up he died of natural causes, the evidence presented to deem his death is non-suspect.

GlobeandMail Article (Paywall)
https://www.theglobeandmail.com/world/article-how-did-gerald-cotten-die-a-quadriga-mystery-from-india-to-canada/
Same Article No Paywall Link
https://outline.com/MS67gd

Excerpt:

The couple only planned to spend two hours of a weeks-long honeymoon at the orphanage they had paid to build – though their donation was insufficient to equip the home with doors, even to its bathroom, and leaves the man caring for the orphans in crippling debt.


The Globe’s reporting reveals a man with an appetite for luxury, who, together with his new wife, spent as if money was no object.

“The guy had more money than he knew what to do with,” said Eric Schletz, who got to know Mr. Cotten at a small flying club in Nova Scotia. “I’ve seen Gerry walk through an airport with $50,000 in cash. That’s the scale of money the guy had. He was a very reasonable person. But if he was going to spend the money, he was going to buy something nice.”

In India, that included stays at some of the finest accommodations, on a tour that would be the envy of most travellers.

Documents gathered by The Globe show that the couple arrived in New Delhi on Nov. 30, entering the country on tourist visas. An image posted to Instagram shows the couple beaming at the Taj Mahal in Agra, one of the country’s best-known attractions. They also spent time in Varanasi, the ancient city on the banks of the Ganges that is one of Hinduism’s holiest sites.

On Dec. 8, they landed in Jaipur.

They planned to spend four nights in the city, according to their booking with the Oberoi, which sent an Audi Q7 to the airport to pick them up, according to e-mails obtained by The Globe. A hotel built as a modern-day palace, the Oberoi was ranked the second-best resort hotel in the country last year by Travel + Leisure, outranking even the city’s actual palace, the Rambagh, where Jacqueline Kennedy once stayed.

Ms. Robertson had booked a deluxe room at $923 a night (the Oberoi does not accept bitcoin for payment). Asked by the hotel to specify if they were travelling for a special occasion, she wrote: “Our honeymoon.”

...
But Mr. Cotten’s involvement here has been a mixed blessing. Mr. Cherukupalli is a Christian pastor who began to care for local orphans two years ago, buying a tract of land and erecting a temporary shelter.

“My wife and I both had the same dream – to do something for orphans and give our lives in service,” he said. He took on debt to build the small orphanage, but the monthly payments were manageable.

Then, through another pastor, he was asked if he would be interested in becoming involved with Angel House, which promised a concrete structure that wouldn’t leak when it rained.

He accepted. Unknown to him, the Angel House donation came from a Canadian cryptocurrency entrepreneur.

Mr. Cotten’s money, however, did not buy an orphanage. It bought materials, but Mr. Cherukupalli had to arrange the construction himself. And the materials were insufficient – there was enough for walls and furnishings, but not enough to complete the roof, equip the kitchen or install interior doors. Mr. Cherukupalli began to accumulate more debt as he secured labour and additional materials. The orphanage is still missing seven doors – including one to its bathroom – because he does not have the money.

He now owes almost $11,000, equivalent to seven years of average income. The monthly payments have gotten so high that he has quit trying.

Mr. Cotten’s donation “provided materials. That’s a good thing, and it’s good for the kids,” Mr. Cherukupalli said. “But financially, I have gone under. And I’m suffering.”

He has also yet to receive the stuffed bears that Ms. Robertson had brought for the grand opening. She left them at the Oberoi with instructions that they be shipped to the orphanage.

Still, for Ms. Robertson, the existence of Jennifer Robertson & Gerald Cotten House seems to have provided some solace.

In mid-January, she sent an e-mail to Angel House, saying she hoped she could still visit the orphanage one day and acknowledging receipt of some pictures from Venkatapuram.

They “are lovely,” she wrote. “It helps me feel better knowing my husband helped these children before he died.”

If it's true then that is one of the dimmest courses of action I've read about in recent years in relation to cryptoland. I sure as hell would not subsidise such utter stupidity.

Yeah I'm not sure on the specifics of it all. I personally would have expected all control of known private keys/passwords, for any wallet associated to Quadriga to have been handed over. I don't see it as any different than bank accounts or physical assets. I assume that Ernst and Young had been selected for this role hopefully to having a high level of understanding of the crypto world in general. So no one from Quadriga should have had the opportunity or the means to move any coins around.

Who knows though assumptions do have a way of failing me at times.


Hopefully this isn't the next gofundme scam... man I'm getting cynical.

Court Case Today
It will be Interesting to see court reactions to we lost another $500,000 in legal sense.
https://globalnews.ca/news/4960203/case-of-cryptocurrency-firm-quadrigacx-to-return-to-a-halifax-courtroom/
https://www.cbc.ca/news/business/quadrigacx-1.5019176

On a sidenote Gofundme was made for the guy
https://www.gofundme.com/f/tong-zhou-relief-fund

I'm not sure how that was supposed to work. Was Ernst and Young really supposed to take custody of the cryptocurrency wallets? A law firm holding bank accounts in trust/escrow is one thing. Holding bitcoin wallets is another.

Those were the hot wallet coins, so given that the site is indefinitely shut down and no customers will be withdrawing anytime soon, it made sense to move them to cold storage. Cold storage that could actually be accessed, that is.

He likely didn't know better which is even worse, I mean if he thought their office was in Vancouver and moved there only to find it did not exist to complain then a few months later due to this court realized that the real operations was in Nova Scotia I would be pretty screwed over to.

I agree hopefully he gets some back, I saw some Canadian exchanges on Linkedin want to get in touch with him, not sure why though maybe a job offer given his skillset.