Crypto Exchange Accidentally Places Another 350K In "Cold Storage" Behind Lost Password

By on February 22, 2019 in ArticlesHow Much Does

If someone were to invent a cryptocurrency firm to be used as an example of what can go wrong in certain (hopefully unlikely) circumstances, it might not look too different from the beleaguered and no longer operational crypto exchange QuadrigaCX. You might recall that that's the name of the company that says it can't access the reported $190 million worth of bitcoins locked in its "cold storage" because the founder Gerald Cotten unexpectedly died without leaving behind any information on his passwords.

That leaves Quadriga unable to pay the hundreds of millions of dollars it owes about 115,000 users, and Cotten's widow Jennifer Robertson has filed for credit protection due to the mishap. Now, reports have come out that the firm has lost another $350,000 in crypto by accidentally transferring it into cold storage.

Dan Kitwood/Getty Images

Bloomberg reports the value of the recently transferred 103 bitcoins at at least $354,300, but that value is fluctuating all the time. As for how this could have happened, the most recent incident has triggered plenty of speculation, just like the initial one has. Eric Larcheveque is the head of a cryptocurrency cold-storage startup called Ledger SAS, and he tells Bloomberg that possibilities range from a system that automatically wires money in clients' accounts into cold storage once it surpasses a given threshold, to a simple accidental transfer by a client who wasn't aware of the situation.

As the case continues to make its way through the Canadian court system, plenty of QuadrigaCX clients are watching eagerly to see if there's any way for them to get their money. Ernst & Young is the company appointed by the courts as the official "monitor" of Quadriga's restructuring efforts, and they've set up both a toll-free hotline and an email address to allow clients to stay updated on what's going on in court.

Did we make a mistake?
Submit a correction suggestion and help us fix it!
Submit a Correction