Millions in cryptocurrencies frozen after Canadian founder's death

Gerald Cotten dead or not

This protects them from hacking and virtual theft but does mean that the entire value of the wallet rests in the hands of those with the password.

Users have very little recourse to recover those funds, said Christine Duhaime, a lawyer and founder of the Digital Finance Institute.

QuadrigaCX says it can't reach millions of dollars' worth of bitcoin and other cryptocurrency after its CEO died during a December trip to India. The cryptocurrencies the exchange dealt with were bitcoin, bitcoin gold, bitcoin cash, bitcoin cash SV, litecoin and ether.

The situation has been laid bare in a filing at the supreme court of Nova Scotia, where Quadriga and related companies have made an application for creditor protection. "Unfortunately, these efforts have not been successful", the board said.

Cotten died of complications from Crohn's disease while doing philanthropic work in India in early December, according to a post on Quadriga's Facebook page.

In her court filing, Robertson notes that Cotten's laptop is encrypted and she does not know the password or recovery key. In fact, there's reportedly $190 million U.S. locked up within encrypted drives belonging to a recently deceased Canadian crypto exchange owner.

Robertson also told the court she could not locate his passwords or business records for the company.

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She noted she had received threats and slanderous comments and had seen "a significant amount of commentary on Reddit and other web-based platforms about Quadriga, Gerry's death (including whether he is really dead) and missing coins".

Gerald Cotten died aged 30 from complications with Crohn's disease while volunteering at an orphanage in India, according to the Facebook page of Quadriga CX, which announced his death on January 14.

Another wrote in French: "I have sent lots of emails, but I just get automatic responses, I'm not even able to get my crypto out".

A court hearing on Quadriga's financial difficulties is scheduled for Tuesday in Halifax, Nova Scotia.

All we can say for certain right now is people don't have their money, and they're very unhappy.

It is understood that save for some money in what is effectively a petty cash drawer, virtually all of the exchange's funds are locked up, meaning customers are unable to withdraw their dosh, practically speaking. Other companies have already come forward to express interest, she said, warning that the platform's value would nearly certainly be undercut if the company faced a legal threat from its users.

As Gizmodo summarized, QuadrigaCX therefore "cannot repay most of $190 million in client holdings", since Cotten was the only person who could access the money.

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