Study: QuadrigaCX Never Had More Than 100 BTC
Analysts at CryptoMedication suggested that the Canadian crypto exchange QuadrigaCX cannot pay the lost $190 million to users, because it never had this amount of money.
In early February, the exchange claimed it lost access to 115,000 wallets where fiat and digital assets of users were kept. The company had more than 26,000 bitcoins, 430,000 ethers, 200,000 Litecoins and other cryptos on its accounts, most of which were held in cold storage.
Specialists studied a number of addresses that the exchange used to transfer money between users. As it turned out, the funds eventually did not come to any cold wallets, and the exchange’s addresses never contained more than 100 bitcoins.
Analysts concluded that QuadrigaCX was not liquid enough from the start, so it only transferred funds from one user to another. They called this behavior illegal and ineffective.
Representatives of QuadrigaCX justified themselves by saying that the head of the company, Gerald Cotten, who was personally responsible for managing the cold storage of the exchange, had died from a disease in India. However, the company did not provide any evidence of this incident. Moreover, analysts traced transactions dated January 24-25, one month after Cotten’s alleged death.
Also, previously Cotten stated that QuadrigaCX used multi-sign technology to protect cryptocurrency reserves. Therefore, the exchange’s claims about losing access to their own wallets seem illogical.
At the moment, the Canadian exchange has gone for “technical works”, and the website is not available to users. Previously, law enforcers found the lost $11 million in the IOTA cryptocurrency.