Ernst & Young, the trustee of the now-bankrupt cryptocurrency exchange QuadrigaCX, published a report showing that almost 17,000 people have filed for the remaining assets of the crypto exchange. EY assumed control of the crypto exchange in February 2019 after QuadrigaCX filed for bankruptcy.
It Could Take Years Before QuadrigaCX Clients Get Refund
Ernst & Young took over custody of QuadrigaCX’s assets following the alleged death of Gerald Cotton, the founder of QuadrigaCX, who held the private keys to the crypto holdings, in January 2019. The report indicates that as many as 16,959 people have claimed assets ranging from Litecoin, Bitcoin, Ethereum, Bitcoin Gold, Bitcoin SV, and Bitcoin cash, along with US dollars and Canadian dollars.
The trustee holds nearly $30 million in assets recovered from the failed crypto exchange at the time of writing. The amount in claims filed by the former customers varies between $167 million to over $300 million. The audit firm said that it would pay out the funds. But the process to pay out the customers is expected to take years because of court and technical proceedings.
The audit firm is yet to come up with a working plan regarding how it will disburse the funds once clearance is given. However, the report warns that the distribution of funds could take years, as witnessed with the Mt. Gox case, which now is in its sixth year.
From a technical perspective, the cryptocurrency exchange is yet to verify all documents obtained from the applicants. Furthermore, some documents contain technical deficiencies like some minor details missing, the missed signature, and the difference in amounts stated by the claimants and the crypto exchange’s database.
Initially, the audit firm asked the affected customers to file for the claims by 1st August 2019. But now the firm clarified that there is no strict deadline for that and will continue receiving requests.
The audit company said that it is still reviewing the filed claims, for several customer claims, the requested amount does not match the registered figure of their account on the crypto exchange database.
At the time of closure, the exchange had more than 115,000 accounts on the platform.
Moreover, the claimants will have to wait for a few more years to get their refunds because the Canadian Tax Authorities (CRA) will also come into play. According to Miller Thomson, a law firm representing QuadrigaCX’s users, the tax agency will have to check for any unfilled taxes on the funds before they are distributed. The agency is yet to audit them.
Are Cryptocurrency HODLers Ready to Create A Will?
There have been huge amounts of crypto assets lost when holders died. The QuadrigaCX crypto exchange went bankrupt in January 2019 following the reported death of CEO and founder, Gerald Cotten. Until now, the QuadrigaCX CEO is believed to have been buried together with a combined $190 million of customers’ funds. After Cotten’s death, 115,000 customers were left in the cold. So far, the report says that Ernst & Young has recovered about 30 million majorly because Gerald Cotten kept no transaction records and appeared to spend clients’ funds to finance a luxurious lifestyle. Several customers are doubtful about Cotten’s death and asked the Canadian authorities to exhume his body.
Research shows that an estimate of 3.8 billion Bitcoins, worth about $30 billion today, has been lost, with most having gone to the grave with the cryptocurrency holders who failed to tell anyone how to retrieve them. The answer to this challenge is to safeguarding crypto assets beyond the grave. Nowadays, crypto firms offer cryptocurrency wills that protect crypto users when things go wrong. Crypto firms store funds on behalf of the crypto holders. Cryptocurrency will guarantee funds to be fully retrievable by beneficiates in case of cryptocurrency owners’ deaths. This is an important solution facing many people who unexpectedly meet their death and go to the grave with crypto assets. Cryptocurrency will is an indestructible card that has information about customers’ funds and those listed as beneficiaries. If a crypto holder dies, then customers and beneficiaries contact the crypto firm, with a unique number on the card. The firm then investigates and thus retrieves the funds.
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