One of North America’s largest crypto exchanges, QuadrigaCX, is making its first major move to move past the bankruptcy stemming from the sudden death of its founder. After a two-month delay, QuadrigaCX will be resuming the distribution of interim funds to customers, an effort that is meant to bring justice to those who were denied access to their holdings in the wake of the founder’s death. This article will provide an overview of the state of affairs at the crypto exchange and what customers can expect in the coming days.
1. QuadrigaCX: Bankrupt Crypto Exchange Resumes Interim Fund Distribution
QuadrigaCX, a Canadian crypto exchange that declared bankruptcy earlier this year, recently announced it will resume interim fund distribution. This news comes as QuadrigaCX’s recovery of the missing funds continues.
- The Interim Fund Distribution: The interim fund distribution will review QuadrigaCX users’ claims for reimbursement of cryptocurrency funds. QuadrigaCX is currently involved in the process of recovering any crypto funds and will eventually distribute them equitably among users.
- QuadrigaCX’s Claims: QuadrigaCX claims more than $500 million of cryptocurrencies, including funds held by the company and its customers. The amount includes BTC, ETH, Litecoin, and other cryptos. The exchange promised to pay back customers after it declared bankruptcy in February.
Many users have seen no progress since the February bankruptcy announcement. As the situation stands, users have to wait for court proceedings to unfold before they can expect compensation. Nonetheless, QuadrigaCX’s announcement of resuming interim fund distribution is considered a major progress in the process of recovering lost/missing funds.
The hope is that users get the compensation they deserve.
2. QuadrigaCX Bankruptcy Administrator’s Proposal to Resume Distributions
The court-appointed bankruptcy administrator for QuadrigaCX submitted a proposal to the Nova Scotia Supreme Court on Thursday that would restart refunds to users of the ill-fated crypto exchange.
In its proposal, the administrator claims that the bankrupt exchange has now accessed and identified its fiat and crypto currencies, with an estimated total value of $23.8 million CAD. Before refunds can be made, it must be determined if the currencies belong to Quadriga or if they are the legitimate property of users of the exchange.
According to the proposal, the process of identifying and confirming the rightful owners of these funds will be completed by Ernst & Young. The process will be overseen by the Supreme Court of Nova Scotia, with the goal of ultimately providing customers with more accurate information about their net balances as soon as practicable.
The proposal includes the following key steps:
- Database Review: Identification of customer data and comprehensive assessment of documents related to transactions.
- Analytics: A review of the QuadrigaCX platform to identify irregular and suspicious activity.
- Client Due Diligence: Identification, documentation and confirmation of customer accounts.
Once the process is completed, and the claims are confirmed, Ernst & Young will then submit a recommendation to the Supreme Court of Nova Scotia, and if approved, restart distributions of customer funds.
3. QuadrigaCX’s Status After Administration and Trustee Appointment
Since the mysterious death of the QuadrigaCX’s founder Gerald Cotten, and the subsequent inability of the exchange’s customers to access their cryptocurrency funds, the company and its fate have been left in the hands of Ernst & Young LLP. Ernst & Young has been appointed as QuadrigaCX’s administrator and trustee.
Recently, Ernst & Young has provided an update with regards to QuadrigaCX’s status. According to the administrator and trustee, significant progress has been made towards returning funds to customers. As of April 30th 2019, Ernst & Young has:
- Transferred CAD $25 million of QuadrigaCX’s cryptocurrency to a cold storage wallet
- Audited the QuadrigaCX’s crypto cold wallets and examined the transactions coming in and out of the wallets
- Identified various third-party service providers that may be holding QuadrigaCX’s cryptocurrencies and fiat currencies
- Started negotiations with the third-party service providers to freeze and retrieve the funds
The progress is encouraging, and customers might soon be receiving their funds. However, Ernst & Young expects the process of returning the funds to take some time due to the complexity of the situation.
4. QuadrigaCX Customers Await Fund Distribution to Move Forward
The long standing saga of QuadrigaCX, a Canadian crypto exchange, is still ongoing. After the death of founder and CEO Gerald Cotten, customers are still awaiting the distribution of their funds. A court-appointed monitor is in charge of the distribution plan and hoping to move forward.
It’s been a bumpy road for creditors who are due to receive funds. After over two years, the priority creditor claims filed in April 2020 have yet to be approved and paid out by the monitor. On the other hand, over $900 million USD in funds is held with payment processors and other parties, but there has yet to be any progress on distributing it. Faced with numerous obstacles, the court-appointed monitor has been unable to locate any of the lost crypto funds.
- Creditors filed priority claims in April 2020 without yet receiving any reimbursement.
- Over $900 million USD in funds is held with payment processors and other parties.
- The court-appointed monitor has been unable to locate any of the lost crypto funds.
The QuardigCX saga continues as the platform resumes its distribution of funds. With its unsettled creditors, the question of what will happen to the platform next will remain uncertain for now. Meanwhile, those who have been waiting for their funds will finally have access to them.
This article was written by [name], a freelance journalist.