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$1.7M in Bitcoin Tied to QuadrigaCX Reawakens After Years of Dormancy

The wallets were thought to be inaccessible following the death of the exchange’s founder in 2018, as he had sole responsibility for the wallet’s private keys.

After years of dormancy, five wallets associated with the defunct Canadian cryptocurrency exchange QuadrigaCX have been spotted moving around $1.7 million in Bitcoin.

In a tweet on December 19, crypto researcher ZachXBT alerted the crypto community, highlighting five wallets that transferred approximately 104 Bitcoin on December 17 to various wallets.

Blockchain records show the wallets had not sent BTC since at least April 2018.

QuadrigaCX, once Canada’s largest crypto exchange, declared bankruptcy in April 2019 following the death of its founder and CEO, Gerald Cotten, in December 2018, who was solely responsible for the private keys of the exchange’s wallets.

At the time of its bankruptcy, 155,000 exchange users owed up to $200 million in cryptocurrency.

In February 2019, a report from Ernst & Young — the Big Four accounting firm overseeing the exchange’s estate — stated that on Feb. 6, 2019, QuadrigaCX accidentally transferred around 103 BTC to cold wallets that only the deceased Cotten had access to. The amount is almost exactly the same as the amount of Bitcoin that has recently moved.

At the time, the company stated that it would work with management to recover the cryptocurrency from the cold wallets.

The sudden death of QuadrigaCX’s founder and CEO, followed by the exchange’s demise, sparked conspiracy theories that the founder staged his own death as part of a fraudulent exit scam.

The story was made into a Netflix documentary in 2022.

Cotten said on a podcast in 2014, years before his death, that the best way to keep private keys was to print them off and store them offline in a safety deposit box, revealing that the exchange kept its private keys offline in the company’s safety deposit box at a bank.

It’s unclear whether the BTC’s movement is related to Ernst & Young’s recovery efforts. Cointelegraph contacted the firm for comment but did not immediately receive a response.

 

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