QuadrigaCX Bankruptcy

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QuadrigaCX became known through the Vancouver bitcoin community in 2013, and was one of the first exchanges in Canada to be FINTRAC registered as a valid money services business. Gerald Cotten was a well known sponsor of the local bitcoin meetup in Vancouver and even held regular office hours early in QuadrigaCX history. In 2015, Quadriga had a Chief Financial Officer and full staff of directors, and was pursuing public listing on the Toronto Stock Exchange. While other firms went bankrupt and folded, QuadrigaCX was able to continue operating for 6 years, occupying 80% of the market at one point.

QuadrigaCX's success was the result of a few factors. Regulatory and banking challenges forced out most of the competition, leaving Gerald Cotten as the only serious remaining competition in 2014. Gerald Cotten officially operated in legal gray areas, avoiding any classification of the cryptocurrencies as securities, nor customer funds as deposits. Where other firms would not dare enter for fear of being shut down and losing their invested capital, Gerald Cotten had a long background of running ponzi schemes since early childhood. By creating fake accounts to trade against clients, Gerald Cotten was able to increase the volume on the platform, and improve the "profitability" of customers who left funds on the platform. Quadriga Coin Exchange raked in hundreds of millions of dollars in client deposits, and Gerald Cotten personally held the keys to all of the funds. Being able to spend customer funds for growth, marketing, and development provided a competitive advantage over other Canadian firms.

In 2016, unfortunately it seemed that Gerald Cotten's policies or behaviour may have created some tension between him and the other directors. The entire rest of the team resigned. After he didn't provide any financial statements, the British Columbia Securities Commission put out a small notice listing his firm amongst other delinquent firms and requesting that they stop trading. This made it difficult to retain banking, so he used different payment processors to receive deposits and send out withdrawals. A major smart contract breach in 2017 caused the loss of $14m CAD of ethereum, but this was still not enough to sink the company. Finally, later in 2018, one of the payment processors decided that they would like to pay themselves $1m from the bank account they'd set up to handle customer funds, and CIBC found that transaction to be somewhat suspicious. After a lengthy legal battle, it became clear that even though a bank draft was issued, the funds would remain effectively frozen because no other Canadian bank was willing to touch the money. It was at this point that Gerald Cotten decided his priorities were to write a will, open an orphanage in India, and enjoy a nice honeymoon.

Unfortunately, while on that honeymoon, there was an unexpected complication from his Chron's Disease that was fatal. At the exact hour that Jennifer Robertson left the hospital to get his laptop, the doctor reported that Gerald Cotten was dead. The body was embalmed by some local college students and sent back to Canada where a closed casket funeral was held. A month later, Quadriga coin exchange users were notified of the tragic passing of the CEO who held the keys to all of their funds. Then became the justice system getting involved. First, Ernst and Young started up the Quadriga platform, triggering the automatic disbursement of funds to the cold wallets held only by Gerald Cotten. Next, a retainer of $2m from client funds was set up for Miller Thompson, which was extended to $4m after the suggestion to proceed into bankruptcy. Finally, the CRA decided that they wanted to perform an audit. The end outcome remains unknown and depends on what's left over after all of the legal oversight is completed.


About Gerald Cotten

Description By Vanity Fair

Gerald Cotten was described by "Vanity Fair" as appearing to be "not an evil dude"[1].

"Cotten was a computer nerd who had entered the right business at the right time and succeeded beyond his wildest dreams. The broad outlines of his story were blandly conventional, at least if you subtracted his interest in decentralized monetary systems. He grew up in a large brick house on a quiet suburban street in Belleville, “The Friendly City,” a waterfront community between Toronto and Montreal best known for its cheddar cheese. In 2010 he graduated with a bachelor’s degree in business administration from an honors program at York University’s Schulich School of Business in Toronto. His parents owned an antiques store; Cotten decided to go into crypto."

Early Interview With Gerald Cotten

In an early interview by The Georgia Straight, QuadrigaCX CEO Gerald Cotten discussed various aspects of the cryptocurrency industry. He describes Bitcoin as a decentralized, peer-to-peer payment system that allows users to send payments without the need for a central authority. The easiest way to get bitcoins in Vancouver is through the company's Bitcoin ATM, which charges no fees and allows for instant funding through Interac Online. The company plans to spread its ATMs across Canada and make buying bitcoins easier for Canadians. The CEO would like to see more clarity from the government on cryptocurrency regulation, and mentions Litecoin and Dogecoin as other cryptocurrencies that have caught his attention. The company is adding Dogecoin to its website in the coming weeks due to its popularity and strong community support[2].

How would you explain, very briefly, Bitcoin to a newbie?

To a newbie, I would describe it as a decentralized, peer-to-peer payment system. It basically allows you to send payments from one user to another without the need of a central authority, such as a bank.

What’s the easiest way to get bitcoins in Vancouver?

The easiest way to get bitcoins in Vancouver is, in my opinion, our ATM, because you just walk up to it, scan your QR code, and within five seconds you’ll have the bitcoins in your Bitcoin wallet.

What sets your online currency exchange apart from the others in Canada?

There’s a few other Bitcoin exchanges in Canada. What mainly sets ours apart is the fact that we charge no fees right now. It’s a promotional thing. In addition to that, we have more account funding options and withdrawal options than any exchange in the country.

One of our main features is Interac Online. It allows any user to fund their account instantly. So, you can actually, from the comfort of your own home, fund your Quadriga CX account through your online banking with Interac Online and buy bitcoins instantly. It’s the fastest way to get bitcoins in Canada.

What are your plans for your Bitcoin ATMs in Vancouver?

The plan with the ATMs is they’re going to be hooked up to our exchange. So, if someone makes a purchase from our ATM, it makes an equivalent trade on our exchange, which basically refills the ATM instantly. Our plan is to spread our ATMs around Vancouver and not just Vancouver—around the country. Because in addition to those three that are coming in about a week, we have an additional large order with Lamassu, where we’ll be spreading the ATMs basically across Canada. We want to spread Bitcoin across the country and basically make buying bitcoins easier for the average Canadian.

The federal government mentioned Bitcoin in its budget this week. How would you like to see cryptocurrencies regulated in Canada?

At this point, I’d like to see a little more clarity from our governmental institutions. Right now, if you contact FINTRAC [Financial Transactions and Reports Analysis Centre of Canada] and ask them about Bitcoin, they’ll basically tell you that Bitcoin is not currently regulated by the government and that they’re unable to provide you with any additional information.

From an exchange point of view, this is quite frustrating, because you’re trying to figure out what the regulations are. We’re quite proactive when it comes to regulations. We don’t want to break the law. We want to fully comply, and we actually more than comply with what the current laws are. So, a bit more clarification from FINTRAC and from the federal government would be very useful—just in terms of planning our business for the future.

What other cryptocurrencies aside from Bitcoin have your attention?

Litecoin is interesting—just because it seems to be pretty much the second largest cryptocurrency.

In addition to that, Dogecoin has been getting a lot of media attention. So, we’re actually adding Dogecoin to our website within the coming weeks. It seems to have a huge amount of community support. It’s very popular on Reddit, and because of that reason it’s caught my attention.

About QuadrigaCX

Early History

"In April 2013, around the time that Cotten appeared in Vancouver, the price of a Bitcoin had risen to $266. But it was not easy to buy or sell if you lacked technological sophistication and considerable patience. Seventy percent of the global Bitcoin trade was conducted through Mt. Gox, a Tokyo-based exchange, and had to be funded by sending a bank wire to Japan." "In November 2013 Cotten and an older business partner, Michael Patryn, an authority on currency trading with passions for Brazilian jujitsu and luxury automobiles, incorporated the Quadriga coin exchange, or QuadrigaCX." "In a small, inefficient market, Quadriga swiftly distinguished itself." "QuadrigaCX initially attracted users because it seemed less risky than other bitcoin trading platforms. It had been licensed by FinTRAC, the Canadian anti-money-laundering task force, and Cotten often told reporters that the fact that the exchange was based in Canada meant that investors “know where their money is going.”"

“If you recall, back in the summer of 2013, there really weren’t many options here in Canada for people to buy and sell bitcoins…There was one exchange [Cavirtex] that was pretty much leading the pack….and then, other than that, you pretty much had to send a wire over to Japan [a reference to now-defunct bitcoin exchange Mt. Gox], if you wanted to buy Bitcoin…. You couldn’t hook up your bank account anywhere. It was just such a challenge.”

"Cotten’s efforts to win the trust of Bitcoin enthusiasts relied on his reputation in Vancouver, where he had become a director of the Bitcoin Co-op. He began to host the weekly meetups at Quadriga’s office. Quadriga sponsored local Bitcoin conventions and educational events, investments of $500 or $1,000 that yielded incalculable goodwill. Often Quadriga was the only Bitcoin company willing to pay for a sponsorship. “From our perspective, we needed Quadriga,” says Andrew Wagner, who at the time was the co-op’s director of public relations. “Without them, our events would have stopped. It put us in a particular place of need.”"

"In February 2014, six weeks after Quadriga launched, Mt. Gox abruptly suspended operations, claiming that hackers had stolen $473 million from customer accounts. A year later, Canada’s largest exchange, CaVirTex, announced its closure, also blaming hackers; the second-largest exchange, Vault of Satoshi, closed the same week. Overnight, Quadriga became Canada’s dominant Bitcoin marketplace. The following year it launched a bid to be listed on the Canadian stock exchange, submitting to a full financial audit. “We’re excited,” said Cotten at the time, “to be able to provide an unparalleled level of transparency.”"

In February 2015, "Unable to grow the company organically, Cotten and Patryn push forward with a plan to take Quadriga public. They raise $850,000 CAD in capital from Canadian brokerage houses Haywood Securities, Jordan Capital Markets, PI Financial, and Wolverton Securities." "Cotten ultimately abandoned the effort after a dispute with one of the major investors. Quadriga’s entire board resigned, leaving Cotten as Quadriga’s only full-time employee. Despite additional travails—a software glitch that lost C$14 million, a cease-trade order from the British Columbia Securities Commission after Cotten failed to file an audit, and CIBC’s seizure of C$21 million from one of its payment processors after the bank failed to determine its rightful owner—Quadriga profited wildly from Bitcoin’s giddy rise."

"Cotten is said to have operated the exchange from his MacBook, and while reports indicate he’d set a “dead man’s switch” that would forward access to the cryptocurrency keys required to handle up to $250 million worth of customer funds still in play, Cotten’s sudden disappearance has left users entirely out-of-pocket." “The normal procedure was that [QuadrigaCX founder and CEO Gerald Cotten] would move the majority of the coins to cold storage as a way to protect the coins from hacking or other virtual theft.” "Cotten, who appears to have overstated the company’s revenue, according to the auditors, reportedly juiced the volume of trades on the platform by creating fake accounts and using them to trade counterfeit bitcoin for real cash and cryptocurrency."

This exchange or platform is based in Canada, or the incident targeted people primarily in Canada.

The background of the exchange platform, service, or individuals involved, as it would have been seen or understood at the time of the events.


  • Known history of when and how the service was started.
  • What problems does the company or service claim to solve?
  • What marketing materials were used by the firm or business?
  • Audits performed, and excerpts that may have been included.
  • Business registration documents shown (fake or legitimate).
  • How were people recruited to participate?
  • Public warnings and announcements prior to the event.

Don't Include:

  • Any wording which directly states or implies that the business is/was illegitimate, or that a vulnerability existed.
  • Anything that wasn't reasonably knowable at the time of the event.

There could be more than one section here. If the same platform is involved with multiple incidents, then it can be linked to a main article page.

Regular SEDAR Released Documents

QuadrigaCX regularly released documents through SEDAR (the System for Electronic Document Analysis and Retrieval), a system overseen by the Canadian Securities Administrators[3]. In documents released on SEDAR, QuadrigaCX described itself as a leader in the digital currency space, providing innovative products and services such as Canada's longest-running Bitcoin trading platform, merchant payment processing platform, and the country's first R&D lab for Blockchain technology. The company is regulated by FINTRAC as a Money Services Business and is driving innovation in the rapidly-expanding Blockchain and digital currency services sector[4].

Quadriga FinTech Solutions Corp. is a leading pioneer in the digital currency space. The company

provides a wide range of innovative products and services, including Canada’s longest-running Bitcoin

trading platform, merchant payment processing platform and Canada’s first R&D lab for Blockchain

technology. Quadriga is regulated by the Financial Transactions and Reports Analysis Centre of Canada

(FINTRAC) as a Money Services Business. FINTRAC is the main supervisory body that oversees and

regulates Canada’s financial services industry. With industry-leading security and ease of use, Quadriga

is driving innovation in the rapidly-expanding Blockchain and digital currency services sector.

The Reality

While QuadrigaCX was still Canada's leading cryptocurrency exchange platform at this time, there were many cracks and warning signs which started to develop prior to the ultimate collapse of the platform.

QuadrigaCX Bucks On Terms of Service

The terms of service of Quadriga Coin Exchange featured a following terms of service which reported that all funds were denominated in "QuadrigaCX Bucks" that the user purchased.

“All account fundings are considered to be purchases of QuadrigaCX Bucks. These are units that are used for the purposes of purchasing Bitcoin or other cryptocurrencies. QuadrigaCX Bucks are NOT Canadian Dollars. Any notation of $, CAD, or USD refers to an equivalent unit in QuadrigaCX Bucks, which exist for the sole purpose of buying and selling Bitcoin and other cryptocurrencies. QuadrigaCX is NOT a financial institution, bank, credit union, trust, or deposit business. We DO NOT take Deposits. We exist solely for the purposes of buying and selling cryptocurrencies.”

Directors Anthony Milewski and Lovie Horner Resignations

On February 29, 2016, Quadriga FinTech Solutions Corp. announced that two of its directors, Anthony Milewski and Lovie Horner, had resigned from their positions. The company stated it was currently searching for new directors to fill the vacancies[4].

TORONTO – (February 29, 2016) Quadriga FinTech Solutions Corp. (the “Company”) announces that

Anthony Milewski and Lovie Horner have resigned as Directors of the Company effective immediately.

The board of directors is currently conducting a search to fill the vacant roles and would like to thank both

Mr. Milewski and Ms. Horner for their efforts and contributions to the Company.

British Columbia Securities Commission Cease Trade Order

The British Columbia Securities Commission (BCSC) issued a cease trade order on March 8th, 2016 for several reporting issuers, including Quadriga Fintech Solutions Corp., due to their failure to file annual audited financial statements and management's discussion and analysis for the period ended October 31, 2015. The order prohibited all trading in their securities until the required records were filed and the Executive Director revoked the order. The order was issued by Allan Lim, the Manager Corporate Finance at BCSC[5].

The Reporting Issuer has not filed:

1. annual audited financial statements for the year ended October 31, 2015, as required under Part 4 of National Instrument 51-102 Continuous Disclosure Obligations  (NI 51-102), and

2. a Form 51-102F1 Management's Discussion and Analysis for the period ended October 31, 2015, as required under Part 5 of NI 51-102

(the required records).

Under section 164(1) of the Act, the Executive Director orders that all trading in the securities of the Reporting Issuer cease until:

1. it files the required records, completed in accordance with the Act and rules, and

2. the Executive Director revokes this order as it applies to the Reporting Issuer.

Director Bill Filtness and CFO Natasha Tsai Resignations

On March 18th, 2016, Quadriga FinTech Solutions Corp. announced that one more of its directors, Bill Filtness, and CFO Natasha Tsai, had resigned from their positions. The company stated it was currently searching for new directors to fill the vacancies[6].

TORONTO – (March 18, 2016) Quadriga FinTech Solutions Corp. (the “Company”) announces that as Bill Filtness and Natasha Tsai have resigned as Director and Chief Financial Officer of the Company.  The board of directors is currently conducting a search to fill the vacant roles and would like to thank both Mr. Filtness and Ms. Tsai for their efforts and contributions to the Company.

Locking of Smart Contract Funds


Death of Gerald Cotten


Delayed Announcement of Death

"Though the 30-year-old died in December 2018, according to his widow, it took more than a month for the cryptocurrency exchange to publicly reveal that he had passed away." "Just four days before the trip, the magazine noted, Cotten had written a will." "The Canadian crypto exchange announced on Jan. 14, 2019, that CEO Gerald Cotten had died while on honeymoon in India with his wife, Jennifer Robertson." "[C]ondolences flooded in from around the world. As the company explained, the 30-year-old had been nine days into his honeymoon in India, where he planned to open an orphanage, when he suddenly collapsed because of complications of Crohn’s disease." "But before long, the words of support and sympathy were replaced by panicked messages from investors: Where was their money?" "The deceased head of the exchange did not create any backup to recover the passwords of the exchange’s stored digital assets, resulting in the lockdown of cryptocurrency worth millions."

What Happened

"QuadrigaCX collapsed in 2019, leaving more than 76,000 investors from Canada and around the world collectively out-of-pocket for at least $169 million. Following a 10-month investigation, the OSC released a report stating that the crypto company was a Ponzi scheme." "Citing a creditor protection filing from the Nova Scotia Supreme court, the Globe and Mail states that the firm has been unable to locate or access the funds since Cotten passed on Dec. 9, leading to a liquidity crisis at the exchange. QuadrigaCX filed for creditor protection in compliance with the Companies' Creditors Arrangement Act (CCAA) on Feb. 1."

The specific events of the loss and how it came about. What actually happened to cause the loss and some of the events leading up to it.

Key Event Timeline - QuadrigaCX Bankruptcy
Date Event Description
October 16th, 2004 Omar Dhanini Arrested TBD fill in all events from Amy Castor[7].
November 2013 QuadrigaCX Founded The company is founded[8]. The exchange first starts with conducting local trades of cash for bitcoin


December 2013 Exchange Launches The Quadriga coin exchange itself launches[8][10] with a staff of just 5[9].
January 30th, 2014 QuadrigaCX Launches Vancouver Bitcoin ATM QuadrigaCX launches a bitcoin ATM in Vancouver, which is only Vancouver's second bitcoin ATM, which is a Lamassu Bitcoin Machine that cost $5,000[9]. The exchange leaves "beta"[9].
February 14th, 2014 10:10:00 AM MST The Georgia Straight Article The Georgia Straight (Vancouver Free Press) publishes an interview with Gerald Cotten. The article highlights the recent bitcoin ATM launched. It states the company is expecting to receive 3 more ATMs "in a week or so". It provides an address of 332 Water Street in Gastown for the exchange headquarters, and indicates that Gerald Cotten will be at an art and trade show on Saturday and a currency and commodity exchange which is part of an event called CoinFest[9].
February 15th, 2014 4:00:00 PM MST Gerald Cotten At CoinFest Gerald Cotten is attending the CoinFest in Vancouver, first an art and trade show at the Vancouver English Centre, followed by the currency and commodity exchange at the Doolin's Irish Pub[9][11].
March 14th, 2015 5:05:37 PM MDT Quadriga Fintech Solutions Website Live The first capture is taken of the Quadriga Fintech Solutions website, which provides a glimpse of the corporate entity public face. It provides details on the trading platform, merchant services, and remittance solutions they offer as "the leader in cryptocurrency solutions"[12].
March 2015 Move To Go Public The parent company Quadriga Fintech looks at taking QuadrigaCX public, but nothing materializes[8].
March 15th, 2015 7:59:33 PM MDT Quadriga Fintech Solutions Corporate Profile The corporate profile of Quadriga Fintech Solutions is captured. It highlights the online trading platform, the "first bitcoin exchange in Canada to be licensed by FinTRAC". According to this description, the exchange also supported "gold bullion", Quadriga is offering merchant payment processing systems for businesses to accept bitcoin, and they are in negotiations with two online casinos to become their "sole bitcoin processing merchant platform". Finally, Quadriga utilizes "the technologyy of the bitcoin blockchain" to provide a remittance service for Mexico and the Carribbean[10].
February 29th, 2016 Anthony Milewski and Lovie Horner Resign Anthony Milewski and Lovie Horner resign[8]. "The board of directors is currently conducting a search to fill the vacant roles and would like to thank both Mr. Milewski and Ms. Horner for their efforts and contributions to the Company."[4]
March 8th, 2016 BCSC Cease Trade Order The British Columbia Securities Commission issues a cease trade order, since no audited financial statements were recieved[8]. The order was issued against several reporting issuers, including Quadriga Fintech Solutions Corp., due to their failure to file annual audited financial statements and management's discussion and analysis for the period ended October 31, 2015. The order prohibited all trading in their securities until the required records were filed and the Executive Director revoked the order[5].
March 18th, 2016 Bill Filtness and Natasha Tsai Resign Director Bill Filtness and CFO Natasha Tsai both resign[6]. This leaves Gerald Cotten as the sole executive[8].
June 2nd, 2017 5:36:48 AM MDT Smart Contract Funds Locked $14m worth of Ethereum is lost in a smart contract error[8]. The QuadrigaCX platform posts details about the incident to Reddit. They report an issue with their sweeping process for incoming Ether, causing a significant amount of Ether to be trapped in a splitter contract due to a failed transfer to the hot wallet. The problem occurred after upgrading from Geth 1.5.3 to 1.5.9. The issue was related to the prefixing of the Hex string in the Web3 SHA3 implementation. The contract was called with an invalid data payload, resulting in the trapped ETH. The problem has been resolved, and recoverability could be addressed through an amendment to EIP 156. While this setback has impacted QuadrigaCX's profits, it does not affect account funding, withdrawals, or the exchange's day-to-day operations. All withdrawals, including Ether, are being processed normally, and client balances remain unaffected[13].
January 2018 Financial Difficulties Begin Verdict attributes without details to financial difficulties starting at this month[8].
March 2018 Experiencing Delays For Months Verdict reports that this is when customers have been first revealing that they've been experiencing delays for months[8]. TBD[14]
April 2018 Delays Due To Canadian Bank Dispute QuadrigaCX publicly declares that the cash out delays are related to disputes with Canadian banks[8]. TBD[15]
October 2018 CIBC Fund Dispute Underway QuadrigaCX disputes a $19.6m sum with the Canadian Imperial Bank of Commerce (CIBC). The CIBC says it is unable to determine the real owners of the funds. Canadian newspaper the Globe and Mail reports that QuadrigaCX has been experiencing difficulties accessing $16.3m of its fund since January 2018[8].
November 9th, 2018 Ontario Superior Court Favours CIBC In Ruling The Ontario Superior Court rules in favour of CIBC, saying that owner of the $19.6m funds is unclear[8]. TBD[16]
November 27th, 2018 Gerald Cotten Writes Will Gerald Cotten files a will that leaves all his assets to his wife, Jennifer Robertson, naming her as the sole benefactor and executor to his estate[8].
December 9th, 2018 Gerald Cotten Allegedly Dies Co-founder of QuadrigaCX Gerald Cotten, allegedly the only one with access to the private keys, dies at age 30 while honeymooning in India[8][17][18]. The company reports he was building an orphanage in India[8].
January 11th, 2019 1:31:45 PM MST Reddit Announcement About Fund Release Aaron Thompson from QuadrigaCX reports both good and bad news regarding the release of funds[19]. The good news is that BMO (Bank of Montreal) has released the funds. However, the bad news is that they have returned the funds in the form of bank drafts, refusing to accept them. Currently, the company is working with Billerfy to endorse the drafts so that they can be cashed into a specific bank account. The drafts are expected to be endorsed and deposited on Monday. All backlogged payments have been queued for processing, but due to this setback, it may take around two weeks to start settling them. Small payments are still being made daily, and efforts are being made to clear the backlog as quickly as possible. The company appreciates the patience of its customers and will continue to provide updates[20].
January 14th, 2019 Formal Announcement Released A formal announcement is posted that the QuadrigaCX founder has died[8]. Further Reddit posts indicate that users are having trouble accessing their funds. TBD[21][22]
January 15th, 2019 Platform Shutdown The time of platform shutdown, according to Bitcoin Magazine[17].
January 28th, 2019 Offline For Maintenance The QuadrigaCX website goes offline for maintenance[8].
January 31st, 2019 Jennifer Robertson Files Affidavit In Nova Scotia Court An affidavit is filed in a Nova Scotia Supreme Court by Jennifer Robertson, stating that Gerald Cotten was the only one with access to the laptop cold storage which is believed to contain around $137m in cryptocurrencies. QuadrigaCX files for creditor protection[8]. TBD[23][24]
February 1st, 2019 9:31:14 AM MST Cold Wallet Address Research Post Reddit user Randomshortdude posts on Reddit about the importance of finding the smart contract wallet address[25]. TBD There's a lot more to review in this thread.
February 1st, 2019 11:02:00 AM MST CoinDesk Article Published About Affidavit Troubled Canadian cryptocurrency exchange QuadrigaCX owes its customers $190 million and is unable to access most of the funds, according to a court filing. The widow of QuadrigaCX's founder, Jennifer Robertson, revealed in an affidavit that the exchange owes customers approximately $250 million CAD ($190 million) in both cryptocurrency and fiat. The filing provided details about the exchange's financial situation, stating that it holds various cryptocurrencies including bitcoin, bitcoin cash, bitcoin cash SV, bitcoin gold, litecoin, and ether. Robertson explained that the majority of the coins were stored in cold storage to protect them from hacking or theft, but after her husband's death, the inventory of cryptocurrency became unavailable, with some potentially lost. The exchange also faced issues with accessing its fiat holdings due to banking problems, including a legal dispute with the Canadian Imperial Bank of Commerce. QuadrigaCX requested a stay of proceedings to have additional time to find any available cryptocurrency and negotiate bank drafts, while also considering the sale of its operating platform. The court is expected to schedule a hearing on February 5 to confirm the stay of proceedings and appoint Ernst & Young as an independent overseer of the exchange's operations[26].
February 4th, 2019 MyCrypto No Ethereum Cold Wallet Founder and CEO of non-custodial wallet MyCrypto raises the possibility that there may not have been an Ethereum cold wallet at all[8]. TBD[27]
February 5th, 2019 7:54:00 AM MST Forbes Article Published A Forbes article is published on the QuadrigaCX situation[28]. TBD review further.
February 5th, 2019 CCAA Process Started An Indian government-issued death certificate appears to corroborate QuadrigaCX’s statement, but the certificate misspells ‘Cotten’ as ‘Cottan’. Canadian Apex Court appoints Ernst & Young to investigate the lost funds during a preliminary hearing. Research conducted by the editor of blog Zerononcence cannot find evidence for the existence of a QuadrigaCX Bitcoin cold wallet[8]. TBD[29][30][31] The QuadrigaCX website
February 5th, 2019 12:50:19 PM MST Website Updated to Announce CCAA The QuadrigaCX website is updated[32] to announce the Companies' Creditors Arrangement Act (CCAA) process underway, along with a FAQ being published[33]. QuadrigaCX announces being unable to access its cryptocurrency reserves held in cold wallets, required to satisfy customer cryptocurrency balances on deposit, and has been unsuccessful in sourcing a financial institution to accept bank drafts being transferred to it. The court appointed Ernst & Young Inc. as an independent third party to oversee proceedings as QuadrigaCX attempted to address its customer obligations. QuadrigaCX stated that it was exploring a number of options to settle its customer obligations and that the CCAA process would allow it to keep all options open to attempt to maximize the funds available for the company's stakeholders. Customers were told that each of their trade histories would be preserved and that Ernst & Young could be contacted for updates on the proceedings. The company stated that it would seek authorization from the court to restart the website if appropriate at a later date[34].
February 6th, 2019 Creditor Protection Granted The Canadian Supreme Court grants QuadrigaCX a court order for creditor protection, giving the exchange 30 days of initial protection from its creditors while it comes up with a ‘Plan of Arrangement’[8]. This is also when Ernst & Young transfers 104 bitcoin to Gerald Cotten's cold wallets[35].
February 16th, 2019 5:41:33 PM MST BBC News Article BBC News publishes an article on the Quadriga Coin Exchange collapsing[36][37]. TBD fill in more details. This article hasn't changed.
February 20th, 2019 Monitor Releases Second Report E&Y, the monitor of the bankruptcy, releases their second report[35]. TBD more details and any other information from this source.

TBD get information from the second monitor report. This was reported on Global News[38] and CBC[39].

February 21st, 2019 9:51:38 AM MST Global News Report On Cold Wallet Transfer Global News reports on Ernst and Young's inadvertent transfer of the hundreds of bitcoin and other cryptoassets from the Quadriga Coin Exchange cold BD more details.
February 22nd, 2019 Brian Armstrong CoinRivet Article A CoinRivet article is published where CoinBase CEO Brian Armstrong provides some theories as to what's happened with QuadrigaCX, namely that the platform is using the death to obfuscate missing funds[40]. The Tweet has since been deleted[41] and the URL of the original Tweet has been excluded from the Internet Archive[42].
February 27th, 2019 Kyle Gibson Mention Kyle Gibson publishes his timeline, and includes QuadrigaCX with a total loss of $145m[43].
April 8th, 2019 2:17:00 PM MDT CoinDesk Article on Bankruptcy Declaration CoinDesk reports on Quadriga Coin Exchange entering bankruptcy[44]. TBD add more information.
April 9th, 2019 Bankruptcy Declaration [45] (TBD).
April 10th, 2019 Liberty Reserve Link An article is published which links Gerald Cotten and Michale Patryn to a Liberty Reserve intermediary Midas Gold, which had it's domain seized just months before QuadrigaCX was launched[46][47]. (TBD)
April 11th, 2019 Termination and Bankruptcy Assignment Order "On April 11, 2019, the Supreme Court of Nova Scotia issued a Termination and Bankruptcy Assignment Order outlining the process by which the Quadriga CCAA proceedings will be converted to bankruptcy proceedings under the Bankruptcy and Insolvency Act


April 16th, 2019 Conversion To Bankruptcy Announced The conversion from a CCAA proceeding to a bankruptcy process is announced on the trustee website and QuadrigaCX homepage[34]. On April 11, 2019, the Supreme Court of Nova Scotia issued a Termination and Bankruptcy Assignment Order stating that the Quadriga CCAA (Companies' Creditors Arrangement Act) proceedings will be converted to bankruptcy proceedings under the Bankruptcy and Insolvency Act. Customers were advised to refer to the Fourth Report of the Monitor for more information regarding the change in proceedings[48].
May 1st, 2019 TheNextWeb Article The QuadrigaCX bankruptcy is included in TheNextWeb's article. This references $190m lost[49].
May 8th, 2019 BitcoinExchangeGuide The loss amount is published by BitcoinExchangeGuide at $145,000k[50][51].
May 24th, 2019 Bitcoin Magazine Publication Bitcoin Magazine publishes an infographic covering various exchange compromise events, including QuadrigaCX[17].
September 17th, 2019 3:35:00 AM MDT CRA Audit Starts The CRA starts an audit of the Quadriga Coin Exchange's books. This is reported in multiple third party sources including Finance Magnates[52].
November 7th, 2019 CrowdFundInsider Article The QuadrigaCX situation is referenced in the CrowdFundInsider article about EZ-BTC[53].
November 22nd, 2019 3:00:00 AM MST Vanity Fair Publishes Secret Life Article Vanity Fair publishes their article on "The Secret Life and Strange Death of Gerald Cotten"[1]. TBD fill in details.
December 13th, 2019 Exhumation Requested Miller Thompson, representative counsel of QuadrigaCX affected users, sends a letter to the RCMP requesting that Gerald Cotten's body be exhumed by spring (given decomposition concerns)[18]. This is reported by The Washington Post[54]. TBD expand with details.
January 14th, 2020 1:30:00 PM MST Reports of FBI Investigation It's reported that the FBI is contacting victims of QuadrigaCX. This is reported by both CoinDesk[55] and TheNextWeb[56].
April 14th, 2020 OSC Prepares QuadrigaCX Report The OSC prepares a report on the QuadrigaCX situation, however this report has not yet been made public at this time[57][58].
May 8th, 2020 12:13:57 AM MDT CipherTrace Q4 Publication Blockchain analytics firm CipherTrace released a Q4 2019 report, which features coverage of QuadrigaCX. It lists losses as US $200m, calls the exchange "scandal-ridden", references a massive international investigation, mentions the request to exhume the body[18][59],
May 13th, 2020 1:12:00 AM MDT Number of Creditors Reaches 17,000 Ernst & Young reports that 16,959 people have claimed assets in the QuadrigaCX exchange[60]. TBD fill in more details of this article.
June 11th, 2020 12:20:03 PM MDT OSC Releases QuadrigaCX Report The Ontario Securities Commission publicly releases a report on the QuadrigaCX[57]. The Ontario Securities Commission (OSC) has published a report stating that Canadian cryptocurrency exchange QuadrigaCX operated as a Ponzi scheme. The report criticized founder and CEO Gerald Cotten, alleging that he engaged in fraudulent practices such as trading against his own customers, using customers' funds to trade on other exchanges through fake accounts, and failing to maintain proper records. These allegations were previously made by Ernst and Young (EY), the court-appointed auditor overseeing the recovery of customer funds. The report stated that Cotten regularly moved clients' assets off the Quadriga platform and into his accounts on other platforms, misleading contractors about the nature of certain wallet addresses. The OSC found that Cotten lost approximately CAD 169 million ($115 million) through fraudulent trading on the Quadriga platform, resulting in a significant asset shortfall. The report was compiled based on interviews with former Quadriga contractors, advisers, clients, and Cotten's widow, Jennifer Robertson. Quadriga co-founder Michael Patryn did not respond to a request for comment. The OSC concluded that while Quadriga's case was an extreme example, it highlights the risks associated with unregistered cryptocurrency trading platforms. A summary of the report is shared on CoinDesk[58], Bitcoin News[61], and Global News[62].
September 8th, 2020 2:01:00 AM MDT Blockchain Sleuthing Reported Miller Thomson, the law firm representing former users of QuadrigaCX, a failed Canadian cryptocurrency exchange, has hired consultancy firm Kroll and its partner Coinfirm to conduct blockchain analytics work. The move is part of the ongoing dissolution of QuadrigaCX following the reported death of its CEO, Gerald Cotten. The analytics work will involve analyzing a subset of transaction data to assist in asset tracing, recovery, fraud investigations, and data analytics. The decision was made in collaboration with the Official Committee, a group of users appointed by a Canadian court to represent the broader group of former customers. Ernst and Young is also involved in the case as a bankruptcy trustee, aiming to recover and disburse funds to QuadrigaCX's former customers. So far, only a fraction of the owed funds has been recovered. Kroll will be paid a fee of $50,000 and is indemnified against potential lawsuits up to $150,000. The update is reported in CoinDesk[63].
November 5th, 2020 10:45:14 PM MST CoinTelegraph Article Published CoinTelegraph publishes an article with an update on the QuadrigaCX situation[64]. This includes the limited quantity of funds available to handle creditor claims.
November 6th, 2020 2:30:00 AM MST Claims To Settle Using April 2019 Prices A report by TheBlock shows that E&Y plans to settle affected user claims using the cryptocurrency prices from April 2019[65].
March 8th, 2021 Amy Castor Filmed For Documentary Amy Castor is reportedly filmed for inclusion in a "true crime" story on TNT[66].
March 21st, 2021 11:02:34 AM MDT QuadrigaCX Report URL Moved The QuadrigaCX report by the OSC is relocated to a new URL and made into a more visual form[67][68].
April 11th, 2021 6:00:00 PM MDT Lexology Case Study Lexology publishes a case study on the prices being used to settle claims[69].
April 13th, 2021 A Death In Cryptoland Podcast The CBC publishes the first episode[70] of a new "A Death in Cryptoland" podcast on the QuadrigaCX story[71][72]. TBD more details?
April 9th, 2022 8:45:00 AM MDT CoinBureau Analysis on Netflix Documentary YouTube CoinBureau publishes an analysis on the QuadrigaCX case and the Netflix documentary[73]. TBD watch and fill in any other details on this.
July 7th, 2022 7:19:45 PM MDT Amy Castor Summary Published Amy Castor publishes a summary of articles related to the Quadriga Coin Exchange[66]. TBD more detail.

Technical Details

The QuadrigaCX situation was not technically complicated. Money flowed into QuadrigaCX from customers, and then was managed behind the scenes without customers involvement.

TBD - need to fill in more details.

Total Amount Lost

Various sources have reported different amounts for the total lost.

Sources Reporting The Loss Amount
Source Date Cryptocurrency Total Quotes
Verdict.co.uk[8] Feb 6th, 2019 "around $137m" "around $190m"
Kyle Gibson[43] Feb 27th, 2019 $145,000,000
CipherTrace[18] "almost US$200 million"
TheNextWeb[49] May 1st, 2019 $190,000,000
BitcoinExchangeGuide[50] May 8th, 2019 $145,000k
Bitcoin Magazine[17] May 24th, 2019 $190,000,000
SlowMist[74][75] Unknown $190 million $195,000,000 "osing about $190 million worth of cryptocurrency"A "mount of loss: 195,000,000"

The total amount lost has been estimated at $215,000,000+ USD.

How much was lost and how was it calculated? If there are conflicting reports, which are accurate and where does the discrepancy lie?

Immediate Reactions

As Canada's largest cryptocurrency exchange at the time, the QuadrigaCX situation generated a widespread community reaction.

Early Reddit Speculation

Prior to any official announcements from the QuadrigaCX platform, the Reddit community continued to speculate about what may be going on behind the scenes. TBD expand on this section.

Transition To Court Proceedings

"When the company finally came clean and users scrambled to withdraw their money, QuadrigaCX’s website went dark." "In a sworn affidavit filed Jan. 31 with the Nova Scotia Supreme Court, Jennifer Robertson, identified as the widow of QuadrigaCX founder Gerald Cotten, said the exchange owes its customers roughly $250 million CAD ($190 million) in both cryptocurrency and fiat. The company previously announced it had filed for creditor protection on its website, but the filing itself provides greater details about its predicament." “The laptop computer from which Gerry carried out the companies’ business is encrypted and I do not know the password or recovery key,” Cotten’s widow, Jennifer Robertson, said in court filings, according to the Guardian. “Despite repeated and diligent searches, I have not been able to find them written down anywhere.

Initial Website Update To Announce CCAA

On February 5, 2019, Canadian cryptocurrency exchange, QuadrigaCX, announced that it had filed for creditor protection in accordance with the Companies' Creditors Arrangement Act (CCAA) due to outstanding financial issues that had impacted its ability to serve its customers. The company had been working for weeks to address its liquidity issues, which included locating its cryptocurrency reserves held in cold wallets and sourcing a financial institution to accept the bank drafts being transferred to it, but these efforts had been unsuccessful. The court appointed Ernst & Young as a monitor to oversee the proceedings as QuadrigaCX attempted to address its customer obligations and preserve its viability. The company stated that it did not have all the answers at that time, but the CCAA process would allow it to keep all options open to attempt to maximize the funds available for its stakeholders. The company took its website offline during the CCAA process, but it was expected that all account balances on the platform would be dealt with through the process[34][33].

Dear Customers,

Today an order for creditor protection in accordance with the Companies' Creditors Arrangement Act (CCAA) was issued to allow us the opportunity to resolve outstanding financial issues that have affected our ability to serve our customers.

We did not enter into this decision lightly. For the past weeks, we have worked extensively to address our liquidity issues, which include locating our very significant cryptocurrency reserves held in cold wallets required to satisfy customer cryptocurrency balances on deposit and sourcing a financial institution to accept the bank drafts being transferred to us. Unfortunately, these efforts have not been successful. Since we were unable to resolve these issues in a timely fashion, we did not want trading to continue on our platform. We filed for creditor protection to help resolve these matters and preserve the interests of our customers.

With this filing, the Court has appointed a monitor, Ernst & Young Inc., an independent third party to oversee these proceedings as we make every effort to address our customer obligations. Filing for creditor protection allows us to work diligently through the process, and to try ensure the viability of our company.

We are sure you have many questions. We are in the early stages of a long process and we do not have all the answers right now. What we can tell you is that the CCAA process will allow QuadrigaCX to keep all options open to attempt to maximize the funds available for the company's stakeholders. We will provide further updates to the extent possible.

Included below is a Q&A;, which we hope will address some of the questions you may have at this time.

QuadrigaCX values and appreciates all of its customers and its employees. We thank you for your support and understanding during this challenging time.


Q: What does it mean to file for creditor protection?

A: Filing for creditor protection occurs when a business needs time to figure out how it will meet its debt obligations.

Q: Why are you filing for creditor protection?

A: Once it was apparent that we could not access the significant cryptocurrency reserves held in the cold wallets required to satisfy customer cryptocurrency balances on deposit, nor obtain the funds to settle customer currency withdrawal requests, we made the tough but necessary decision to file for creditor protection.

Q: Is there a chance that a solution can be reached to settle customer withdrawals?

A: Over the past weeks we have worked extensively to address our liquidity issues. As such, we are operating under the assumption that a solution will not be reached in the near term, which is why we have filed for creditor protection.

Q: How long will the protection remain in place?

A: Creditor protection is in place for 30-days, with the option to extend.

Q: Why can't you access the coins in the cold wallets?

A: Cold wallets, by their nature, are highly encrypted and were kept off the QuadrigaCX server for security reasons. Gerry took sole responsibility for the handling of funds for QuadrigaCX and as such no one other than him can access the coins in the cold wallets

Q: What steps have you taken to access the coins in the cold wallets?

A: We have hired outside consultants to access these cold wallets. To date, we have accessed a few coins, but not many. Work on that front is ongoing.

Q: Will you opt to extend creditor protection?

A: Our focus right now is the initial 30-days and determining a plan for how to deal with our customer obligations.

Q: Why go through this process when you can just file for bankruptcy?

A: Creditor protection was necessary to protect the interests of our customers. We are exploring a number of options to settle our customer obligations.

Q: Will the website ever be back online?

A: We have taken the website offline while QuadrigaCX is in the CCAA process. It is expected that all account balances on the platform existing as of the date of filing will be dealt with through the CCAA process. Together with the Monitor, the company will determine if it is feasible to restart the website and will seek the court's authorization to do so if appropriate at a later date.

Q: Can I still access my trading history and account information even though the website is inactive?

A: Each customer's trade history will be preserved.

Q: Who can I contact with regards to the status of QuadrigaCX's CCAA process or make a comment?

A: Ernst & Young is appointed by the Court as an independent third party to monitor the proceedings and can be contacted at quadriga.monitor@ca.ey.com

Q: Will you provide a further update?

A: We will provide updates to the extent possible. Public materials filed in relation to our CCAA administration can be accessed via the Monitors website at www.ey.com/ca/quadriga

Funds Transferred To Cold Wallets

"[O]n Feb. 6, Quadriga “inadvertently transferred” certain cryptocurrency into cold wallets that the company is unable to access." "Ernst & Young said in its second report that it has confirmed that the insolvent company’s cold-storage, or offline wallets, continue to hold approximately 104 bitcoins. It had said that 103 bitcoins had been transferred out on Feb. 6." "The court-appointed monitor overseeing the search for the roughly $260 million owed to clients of the embattled QuadrigaCX cryptocurrency exchange says the bitcoin transfer it “inadvertently” made this month was due to a “platform setting error” that prompted the automatic transaction."

Early Forbes Article

An excerpt from an early Forbes article gives an impression of the initial reactions of the wider community[28].

As if crypto winter could not get any colder, the bizarre case of QuadrigaCX, a Canadian cryptocurrency exchange, is both a bucket of cold water and a 101-level lesson in operational risk management. The exchange, home to more than $140 million in cryptocurrencies is in the news and in the Canadian courts due to the death of its founder, Gerald Cotten, who passed away in December and took with him the only passwords to their crypto vaults. By every measure, more than 115,000 hapless investors are left without access to their crypto wealth and little recourse to recover their assets.

Reddit Reactions To Announcement

Community reactions varied widely. TBD fill in.

Investigation To Determine Cold Wallet Addresses

TBD fill in more here.

Ultimate Outcome

What was the end result? Was any investigation done? Were any individuals prosecuted? Was there a lawsuit? Was any tracing done?

Conversion From CCAA Process To Bankruptcy

"The ruling by Nova Source Supreme Court Judge Michael Wood means that QuadrigaCX, which has been operating under the Companies’ Creditors Arrangement Act (CCAA) since the end of January, will file for bankruptcy, entering what is likely to be the final chapter in the exchange’s history." "Please be advised that on April 11, 2019, the Supreme Court of Nova Scotia issued a Termination and Bankruptcy Assignment Order outlining the process by which the Quadriga CCAA proceedings will be converted to bankruptcy proceedings under the Bankruptcy and Insolvency Act. A copy of the Termination and Bankruptcy Assignment Order is accessible via this link." "The transition to bankruptcy will give EY, which will become the exchange’s trustee, greater investigative powers over the company’s missing funds, as well as allow it to begin selling off assets such as its trading platform, which could generate some revenue to make its customers whole."

On April 16th, 2019, the transition was announced in an update on the QuadrigaCX website homepage[34][48].

Dear Customers,

Please be advised that on April 11, 2019, the Supreme Court of Nova Scotia issued a Termination and Bankruptcy Assignment Order outlining the process by which the Quadriga CCAA proceedings will be converted to bankruptcy proceedings under the Bankruptcy and Insolvency Act. A copy of the Termination and Bankruptcy Assignment Order is accessible via this link.

Additional information with respect to the change in proceedings can be found within the Fourth Report of the Monitor, a copy of which is posted on the Monitors web site at www.ey.com/ca/quadriga.

FBI Investigation

"The FBI began looking into the Canadian exchange in March [2019], some three months after its CEO Gerald Cotten is said to have died in India due to complications related to Crohn’s disease." "Correspondence published by the outlet reveal that an FBI victim specialist has emailed former QuadrigaCX users, directing them to an online portal they can use to obtain more information." “As a Victim Specialist with the FBI – Albany, I’m contacting you because we have identified you as a possible victim of a crime,” “The enclosed brochure introduces you to the FBI‘s Victim Assistance Program and the types of assistance that may be available to you,”

Investigation Into Gerald Cotten's Death

"Miller Thomson LLP, the Toronto firm appointed to represent QuadrigaCX users, requests that the Royal Canadian Mounted Police also conduct an autopsy on Cotten’s body, “to confirm both its identity and the cause of death.” Citing the “questionable circumstances” surrounding Cotten’s sudden passing, the attorneys note “the need for certainty around the question of whether Mr. Cotten is in fact deceased.""

Ontario Security Commission Investigation

"The Ontario Securities Commission has spent 10 months investigating what happened to the Quadrigacx cryptocurrency exchange." "The downfall of crypto asset trading platform Quadrigacx (Quadriga) resulted from a fraud committed by Quadriga’s co-founder and CEO Gerald Cotten." “Clients entrusted their assets to Quadriga, which provided false assurances that those assets would be safeguarded,” reads the OSC report. “In reality [Gerald Cotton, Quadriga’s co-founder and CEO] spent, traded and used those assets at will.” "Cotten covered this shortfall with other clients’ deposits. In effect, this meant that Quadriga operated like a Ponzi scheme." "Another $28 million was lost when Cotten used client assets on three external crypto asset trading platforms without authorization or disclosure." "Under normal circumstances, these findings would likely have led to an enforcement action against Cotten and/or Quadriga. However, this is not practical given that Cotten is deceased and Quadriga is bankrupt, with its assets subject to a court-supervised distribution process. Nevertheless, we believe it is in the public interest to share our findings with the public to help investors understand what happened to Quadriga and hopefully prevent this type of situation from recurring."

CRA Tax Audit In Progress

"Notably, the Canadian tax authorities are also probing the doomed exchange for failing to pay corporate taxes." "First reported by The Globe and Mail on Monday, the Canadian tax authority is looking into the tax returns of the defunct exchange from between October 1, 2015, to September 30, 2018." "In March, the CRA collected a vast trove of documents from EY, and there’s no telling how long that will take to dig through, especially given current circumstances." “The CRA did not confirm a timeline of when the CRA Audit will be completed given the COVID­19 pandemic,” the law firm said.

Claims Received From Affected Users

"The trustee for the collapsed Canadian crypto exchange QuadrigaCX has received $171 million in claims from the exchange’s customers." "In a Nov. 6 update filed with the Ontario Superior Court of Justice, EY revealed it has received 17,053 claims from customers who had entrusted their funds with the Canadian exchange." "The former users of the exchange are filing claims for digital assets including Bitcoin, Bitcoin Cash, Bitcoin Gold, Bitcoin SV, Ethereum, and Litecoin, along with Canadian dollars and US dollars." "EY said it wants to settle Quadriga users' crypto claims as of prices on April 15, 2019 — the date on which the exchange declared bankruptcy." "Cryptocurrency has been recognized as “property” for the purposes of the Bankruptcy and Insolvency Act by the Ontario Superior Court of Justice (Commercial List) in Re Quadriga Fintech Solutions Corp. et al.,[1] the first Canadian case of its kind. The Court also fixed the date of bankruptcy as the date for valuing claims denominated in cryptocurrency." "The Trustee is requesting an order of the Court to establish the currency conversion rates by which U.S. dollar and cryptocurrency claims will be converted into Canadian dollars for claim distribution purposes. The specific Date of Bankruptcy (April 15, 2019) rates that the Trustee intends to use are set out in the...chart."

Blockchain Forensic Specialists

"Lawyers representing creditors of the collapsed exchange QuadrigaCX have hired blockchain forensics specialists to help with the ongoing investigation." "In a notice to creditors on Sept. 8, Miller Thomson said that Kroll will be working in collaboration with its strategic partner, Coinfirm, which specializes in blockchain forensics and anti-money laundering (AML) compliance." "Kroll, a division of New York-based financial consultancy firm Duff & Phelps, will not be tackling the project alone, however. It is joining forces with Coinfirm, a London-based blockchain analytics firm. Kroll will receive up to $50,000 USD for their efforts. And EY has provided a contractual indemnity of up to $150,000 USD—three times the professional fees—to protect Kroll from any lawsuits or negligence claims."

Reflections of Community Members

Some reflections of community members long after the aftermath[76].

I lost a few BTC when QuadrigaCX went under/exit scammed in 2018. If you don't know about that, it was the biggest crypto exchange in Canada at one point, and the only decent one with CAD withdrawals. The story behind what happened to it is intriguing.

Seeing BTC price go to 60k this year was extremely painful. Bought in below $700. We all make mistakes - mine was leaving my crypto on an exchange, which I'm never doing again. So don't beat yourself up, just learn from the experience and try to get back in the game.

Featured on CryptoCurrency Hack Lists

The situation was widely known and featured on the CryptoXDirectory list[77].

Total Amount Recovered

"So far, EY has located $35 million (CA$46 million) to pay out to creditors. The amount represents a fraction of the total $190 million (CA$246 million) that went missing when the exchange went belly up early last year."

The exact amount which will be distributed to creditors remains unknown, as it depends on the outcome of a CRA audit and other legal expenses which may still be incurred as part of the disbursement process.

Ongoing Developments

Several aspects of the case remain ongoing.

CRA Audit

The CRA requested to complete an audit of Quadriga Coin Exchange in September 2019[52]. The audit has continued. Bankruptcy law prevent disbursement until 6 months after an audit is completed. TBD more sources.

"But the bigger holdup by far is that the Canada Revenue Agency needs to complete its audit of Quadriga’s tax liabilities, said Miller Thomson."

Bankruptcy Disbursement

Once the CRA audit is completed, and time has passed, lost funds still remain to be disbursed to affected users.

"Two things have to happen before those claims can be filled. The first is that EY has to review each claim individually, and that takes time and money."

"EY has not set any deadline for distributing the amount to the affected users."

Resolution of Gerald Cotten's Death

Given the suspicious circumstances surrounding the death, it remains an open mystery whether Gerald Cotten is dead, as supported by an official death certificate with a typo, the embalming of college students, the word of an Indian doctor, a casket with a body being brought back from India, and Jennifer Robertson's recollection of his last day.

Evidence in support of the death being fabricated include the timing of the will, Jaipur, India being known as a hotspot for fraudulent documentation, numerous journalistic reports of cracks in the birth and death registry system, as well as forged death documentation, and multiple irregularities in the story as it played out.

It is doubtable whether or not any further information will be uncovered towards that end.

General Prevention Policies

The collapse of QuadrigaCX is trivial to prevent. Funds were not stored offline in general, and no background checks were conducted on anyone with keys. There was no multi-signature wallet. There was no visibility of validation of backing.

Indeed, of the 15 rules in our proposed framework, QuadrigaCX violates every single one of them, and therefore it can be argued that any rule at all would have prevented or dramatically reduced the situation.

Individual Prevention Policies

Store the majority of funds offline. By offline, it means that the private key and/or seed phrase is exclusively held by you and not connected to any networked device. Examples of offline storage include paper wallets (seed phrase or key written down and deleted from all electronic media), hardware wallets, steel wallet devices, etc...

Any time that you are promised any profit or benefit in exchange for an initial payment, smart contract approval, or deposit, pay special care as to whether the entity making that offer is trustworthy, actually who they say they are, and has the means to fulfill what they're promising. There are no magic algorithms providing guaranteed returns from trading or mining. Trading on average will lose money. Mining is expensive and complex. No one is going to immediately send back more than you sent them. NFT projects will rarely announce a surprise mint in only a single location. Are you fully prepared for the event your money is kept and nothing is delivered in return?

For the full list of how to protect your funds as an individual, check our Prevention Policies for Individuals guide.

Platform Prevention Policies

All wallets, minting functions, and critical infrastructure should be implemented with a multi-signature requirement, with a recommended minimum of 3 signatures required. This means that making important changes or approving spending will require the keys held by at least 3 separate individuals within the organization to approve. The multi-signature should be implemented at the lowest layer possible, all key holders should have security training, and all key holders should be empowered and encouraged to exercise diligence.

All aspects of any platform should undergo a regular validation/inspection by experts. This validation should include a security audit of any smart contracts, reporting any risks to the backing (of any customer assets, ensuring treasuries or minting functions are properly secured under the control of a multi-signature wallet, and finding any inadequacies in the level of training or integrity of the team. The recommended interval is twice prior to launch or significant system upgrade, once after 3 months, and every 6 months thereafter. It is recommended that the third party performing the inspection not be repeated within a 14 month period.

For the full list of how to protect your funds as a financial service, check our Prevention Policies for Platforms guide.

Regulatory Prevention Policies

QuadrigaCX could have been prevented with the most basic of oversight.

All platforms should undergo published security and risk assessments by independent third parties. Two assessments are required at founding or major upgrade, one after 3 months, and one every 6 months thereafter. The third parties must not repeat within the past 14 months. A risk assessment needs to include what assets back customer deposits and the risk of default from any third parties being lent to. The security assessment must include ensuring a proper multi-signature wallet, and that all signatories are properly trained. Assessments must be performed on social media, databases, and DNS security.

For the full list of regulatory policies that can prevent loss, check our Prevention Policies for Regulators guide.


  1. 1.0 1.1 The Secret Life and Strange Death of Quadriga Founder Gerald Cotten - Vanity Fair (May 17, 2021)
  2. Geek Speak: Gerald Cotten, CEO of Quadriga CX - The Georgia Straight (Apr 27, 2023)
  3. SEDAR Homepage (May 5, 2023)
  4. 4.0 4.1 4.2 Quadriga Announces Resignation of Directors - SEDAR Filing (Apr 28, 2023)
  5. 5.0 5.1 Cease Trade Order - BCSC (May 5, 2023)
  6. 6.0 6.1 Quadriga Announces Resignation of Director and Officer - InvestorX (May 5, 2023)
  7. How the hell did we get here? A timeline of Quadriga events – Amy Castor (May 17, 2021)
  8. 8.00 8.01 8.02 8.03 8.04 8.05 8.06 8.07 8.08 8.09 8.10 8.11 8.12 8.13 8.14 8.15 8.16 8.17 8.18 8.19 8.20 8.21 QuadrigaCX timeline: Every twist and turn in the bizarre crypto scandal (Mar 7, 2020)
  9. 9.0 9.1 9.2 9.3 9.4 9.5 Geek Speak: Gerald Cotten, CEO of Quadriga CX - The Georgia Straight (Apr 27, 2023)
  10. 10.0 10.1 Quadriga Fintech Solutions Corporate Profile Archive - March 15th, 2015 7:59:33 PM MDT (Apr 28, 2023)
  11. CoinFest 2014 to celebrate Bitcoin in Vancouver - The Georgia Straight (Apr 27, 2023)
  12. Quadriga Fintech Solutions Website - Archive March 14th, 2015 5:05:37 PM MDT (Apr 28, 2023)
  13. Statement on QuadrigaCX Ether contract error : ethereum (Mar 6, 2020)
  14. https://globalnews.ca/news/4090875/100k-wire-transfer-bitcoin-canada-quadriga-cx/ (Apr 27, 2023)
  15. https://vancouversun.com/business/local-business/bitcoin-investors-face-long-delays-cashing-out-criticize-two-b-c-firms (Apr 27, 2023)
  16. https://www.canlii.org/en/on/onsc/doc/2018/2018onsc6680/2018onsc6680.html# (Apr 27, 2023)
  17. 17.0 17.1 17.2 17.3 Infographic: An Overview of Compromised Bitcoin Exchange Events (Jan 30, 2020)
  18. 18.0 18.1 18.2 18.3 Q4 2019 Cryptocurrency Anti-Money Laundering Report - CipherTrace (Feb 12, 2020)
  19. Friday update - QuadrigaCX Reddit Archive February 6th, 2019 3:01:33 AM MST (May 8, 2023)
  20. Friday update - QuadrigaCX Reddit (May 17, 2021)
  21. https://www.facebook.com/quadrigacx/posts/2218141444897123 (Apr 27, 2023)
  22. https://www.reddit.com/r/QuadrigaCX/comments/ag5b9g/days_since_they_claimed_payment_was_sent_out/ (Apr 27, 2023)
  23. https://www.scribd.com/document/398721572/Jennifer-Robertson-Affidavit#from_embed (Apr 27, 2023)
  24. https://www.coindesk.com/crypto-exchange-quadrigacx-files-for-creditor-protection (Apr 27, 2023)
  25. Why Finding Out QuadrigaCX's Cold Wallet Addresses Are Critical - BitcoinCA Reddit (Jan 1, 2023)
  26. QuadrigaCX Owes Customers $190 Million, Court Filing Shows - CoinDesk (May 17, 2021)
  27. https://www.ccn.com/mycrypto-ceo-quadrigacx-may-not-have-ethereum-cold-wallet-wheres-the-missing-150m (Apr 27, 2023)
  28. 28.0 28.1 QuadrigaCX: How To Lose $140 Million In An Instant - Forbes (May 17, 2021)
  29. https://www.coindesk.com/indian-death-certificate-crypto-exchange-quadrigacx-death (Apr 27, 2023)
  30. https://coingape.com/quadrigacx-news-canadian-apex-court-investigate/ (Apr 27, 2023)
  31. https://blog.zerononcense.com/2019/02/04/quadrigacx-chain-analysis-report-pt-1-bitcoin-wallets (Apr 27, 2023)
  32. QuadrigaCX Homepage Archive - February 5th, 2019 10:42:20 AM MST (May 5, 2023)
  33. 33.0 33.1 QuadrigaCX Homepage Archive - February 5th, 2019 12:50:19 PM MST (May 5, 2023)
  34. 34.0 34.1 34.2 34.3 34.4 QuadrigaCX Trustee Archive June 5th, 2021 12:29:31 PM MDT (May 17, 2021)
  35. 35.0 35.1 ‘Platform error’ blamed for BTC being sent to Quadriga’s dead CEO’s cold wallet – Amy Castor (May 17, 2021)
  36. Quadriga: The cryptocurrency exchange that lost $135m - BBC News (Jan 22, 2022)
  37. Quadriga: The cryptocurrency exchange that lost $135m - BBC News Archive February 16th, 2019 11:49:36 PM MST (May 9, 2023)
  38. Court monitor determines QuadrigaCX’s inadvertent transfer due to ‘platform setting error’ - Globalnews.ca (May 17, 2021)
  39. QuadrigaCX's inadvertent transfer due to 'platform setting error' - CBC News (May 17, 2021)
  40. Brian Armstrong believes the QuadrigaCX fiasco may have been an accidental exit scam - Coin Rivet (Mar 7, 2020)
  41. brian_armstrong - "This page doesn't exist" - Twitter (Apr 11, 2023)
  42. "This URL has been excluded from the Wayback Machine" - brian_armstrong - Twitter (Apr 11, 2023)
  43. 43.0 43.1 100 Crypto Thefts: A Timeline of Hacks, Glitches, Exit Scams, and other Lost Cryptocurrency Incidents (Jan 25, 2020)
  44. QuadrigaCX Officially Enters Bankruptcy With Millions Still Missing - CoinDesk (May 17, 2021)
  45. Canadian Crypto Exchange QuadrigaCX Officially Declared Bankrupt - CoinTelegraph (Apr 3, 2023)
  46. New documents link QuadrigaCX founders to Liberty Reserve money laundering operation - Messari (Feb 15, 2020)
  47. New Documents Link QuadrigaCX Founders to Liberty Reserve Money Laundering Operation - BreakerMag (Apr 3, 2023)
  48. 48.0 48.1 QuadrigaCX Homepage Archive April 20th, 2019 3:42:54 AM MDT (May 5, 2023)
  49. 49.0 49.1 $356 million in cryptocurrency stolen in first three months of 2019 (Feb 15, 2020)
  50. 50.0 50.1 Bitcoin Scams and Cryptocurrency Hacks List - BitcoinExchangeGuide.com (Mar 5, 2020)
  51. Bitcoin Scams and Cryptocurrency Hacks List - BitcoinExchangeGuide.com - Archive (Apr 11, 2023)
  52. 52.0 52.1 Canadian Tax Authority Probing QuadrigaCX's Corporate Tax Returns - Finance Magnates (May 17, 2021)
  53. Report: Third Vancouver Crypto Exchange Investigated by BC Securities Regulators (Feb 22, 2020)
  54. Gerald Cotten's body should be exhumed, investors in QuadrigaCX tell court - The Washington Post (May 17, 2021)
  55. The FBI Is Now Reaching Out to QuadrigaCX Victims - CoinDesk (May 12, 2023)
  56. FBI contacts users of crypto exchange QuadrigaCX as investigation ramps up - TheNextWeb (May 17, 2021)
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  58. 58.0 58.1 Quadriga Was a Ponzi Scheme, Ontario Securities Regulator Says - CoinDesk (May 17, 2021)
  59. Q4 2019 Cryptocurrency Anti-Money Laundering Report - CipherTrace - Archive (Apr 3, 2023)
  60. Nearly 17,000 Creditors Claim Refunds from QuadrigaCX - Finance Magnate (May 17, 2021)
  61. Canadian Regulator Unveils the Truth Behind Collapsed Crypto Exchange Quadrigacx – Bitcoin News (May 17, 2021)
  62. Collapse of Quadriga crypto exchange was ‘old-fashioned fraud wrapped in modern technology’: OSC - Global News (May 17, 2021)
  63. QuadrigaCX Users' Law Firm Launches Blockchain Analytics Investigation - CoinDesk (May 17, 2021)
  64. QuadrigaCX trustee only has $30M to pay $171M worth of claims (May 17, 2021)
  65. QuadrigaCX trustee EY wants to settle users' crypto claims as of April 2019 prices - TheBlock (May 17, 2021)
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  69. Bankruptcy Court Weighs in on How to Value Bitcoins - Lexology (May 17, 2021)
  70. A Death In Cryptoland - CBC Podcast Archive April 29th, 2021 8:47:39 AM MDT (May 9, 2023)
  71. A Death in CryptoLand - CBC Podcasts (Jun 26, 2021)
  72. A Death In Cryptoland - CBC Podcast (Apr 23, 2022)
  73. CoinBureau - Netflix Crypto Documentary: QuadrigaCX - Here's My Take!! - YouTube (Apr 30, 2022)
  74. SlowMist Hacked - SlowMist Zone (Jun 26, 2021)
  75. SlowMist Hacked - SlowMist Zone Archive October 30th, 2020 10:50:21 PM MDT (May 10, 2023)
  76. StopYTCensorship - "I lost a few BTC when QuadrigaCX went under/exit scammed in 2018." - Reddit (Sep 12, 2022)
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