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QuadrigaCX Lost $500,000 in Bitcoin by Mistake This Month

By Robin Wong | February 13, 2019
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QuadrigaCX Lost $500,000 in Bitcoin by Mistake This Month

Ernst & Young (EY), the appointed monitor of QuadrigaCX exchange, recently reported that QuadrigaCX had accidentally transferred nearly $500,000 in Bitcoin to its inaccessible cold wallet on Feb 6. 

The ‘Big Four’ audit company EY published the report dubbed “First Report of the Monitor” to provide the Court with an update on monitoring activities.

Accordingly, on Feb 6, EY detected an inadvertent transfer of 103 Bitcoins from QuadrigaCX hot wallets to the cold wallets solely managed by Gerald Cotten the exchange CEO. QuadrigaCX was reportedly holding $902,734 in Bitcoin, Litecoin and Ethereum within its hot wallets. 

“The Monitor is working with Management to retrieve this cryptocurrency from the various cold wallets, if possible.” the report says.

EY also claimed to make “arrangements to transfer the remaining cryptocurrency” from the hot wallets into a cold wallet retained by the audit firm pending further order of this Court.

In the course of audit, EY has secured “various Quadriga electronic devices reportedly owned or used by Cotten”, including four laptops, four cell phones, and three fully encrypted USB keys.

The sudden death of the exchange CEO Gerald Cotten has made the exchange inaccessible since January 2019. The exchange seeks creditor protection and allegedly owes its clients $190 million in cryptocurrency.

As The Crypto Sight reported on Feb 12, The Ontario Securities Commission (OSC) is looking to QuadrigaCX scandal to see if the exchange breached any securities laws.

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