Crypto exchange QuadrigaCX not regulated by Canadian securities watchdog

Roman Schwartz
February 11, 2019

Quadriga, Canada's biggest cryptocurrency exchange, said it's unable to gain access to $145 million of bitcoin and other digital assets after the death of Cotten, its 30-year old CEO and Co-Founder. According to the Facebook page of Quadriga CX, which announced its founder's death on January 14th, 2019, Gerald Cotten had died in India, while volunteering at an orphanage.

Experts in the cryptocurrency industry say there's a slim chance technicians will be able to recover the $180 million in digital assets believed to be in the laptop of the late founder of the insolvent QuadrigaCX exchange platform. The court filing also shows that QuadrigaCX now holds: 26,500 BTC worth about $92.3 million; 11,000 Bitcoin Cash (BCH) worth about $1.3 million and another 11,000 Bitcoin Cash SV (BSV) worth about $707,000.

QuadrigaCX, one of the largest Canadian cryptocurrency exchanges, recently left users in the lurch when it took its website offline and filed for creditor protection in Nova Scotia.

Boxmining also noted Cotten's recent marriage, which Boxmining stated occurred just a month before Cotten's death.

Two separate documents released previously - a statement of death issued from J.A. Snow Funeral Home and a death certificate issued from the Government of Rajasthan's Directorate of Economics and Statistics - also state that Cotten died on December 9, 2018 in Jaipur, the state capital of Rajasthan.

According to a Vancouver Sun report, the will specifically states that his wife Robertson was authorised to access his digital assets and "obtain, access, modify, delete and control (his) passwords and other electronic credentials".

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The statement about Gerry Cotten's death serves as chilling proof that was lying right in front of our eyes and we missed it.

There was also a plan in place to provide $100,000 to Cotten's in-laws to help them cover the costs of caring for the couple's pet Chihuahuas, Nitro and Gully. The certificate states "that Gerald William Cotten died on December 9 and Jennifer Robertson is mentioned as his widow" as per the reports obtained from Cointelegraph. The cause of death is not listed.

Earlier today, the BCSC (British Columbia Securities Commission) told Reuters that QuadrigaCX does not fall under the commission's regulatory purview. The statement from Fortis Escorts shared by Coindesk details how Cotten arrived in the hospital and how he died. The agency said QuadrigaCX was not subject to regulation because it did not operate as a marketplace or exchange under B.C. securities laws.

The B.C. Securities Commission issued a statement Thursday saying it has been aware of QuadrigaCX's operations since 2017.

Nova Scotia Supreme Court Justice Michael Wood granted Quadriga a 30-day stay on Tuesday in a bid to stop any lawsuits from proceeding against the company at this time, the Canadian Press reported.

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