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Cryptocurrency Site's Founder Died Without Leaving His Passwords, and Now Customers Can't Access $190 Million of Their Own Money
Yikes.
Cryptocurrencies—or digital forms of alternative currency like Bitcoin—have seen a huge investment spike over the last decade, often to lucrative results.
But there are still huge risks when trading in online money, as investors in Canadian cryptocurrency company QuadrigaCX have learned.
The company's founder, Gerald Cotten, died last year and, with him, all records of the passwords allowing encrypted access to investors' money. As a result, over $190 million remains in internet Limbo, infuriating the company's customers.
In a filing for the Nova Scotia Supreme Court, Cotten's widow Jennifer Robertson detailed how Cotten would upload users' currencies to "cold storage" in an effort to protect the funds from theft. Robertson has no access to the password that would grant her the ability to retrieve funds locked in storage.
Robertson has sought the assistance of encryption experts, but so far, no one has been able to crack the code.
Investors are growing uneasy and even irate.
@QuadrigaCoinEx I actually checked my wallet that is quadrigacx wallet on blockchain and found out my half a bitcoi… https://t.co/qIPPPFJiar— brenarchique (@brenarchique) 1549232544.0
@QuadrigaCoinEx What is happening with QuadrigaCX? I have bitcoin and cash on your exchange that I would like to access.....— Curtis Murphy (@Curtis Murphy) 1548808303.0
@QuadrigaCoinEx This deserves a class action law suit.— Ryan D (@Ryan D) 1549054755.0
@QuadrigaCoinEx I would just like to move my existing funds out... At least give people a chance for that...— Thomas Cheung (@Thomas Cheung) 1548971555.0
@QuadrigaCoinEx I’m lawyering up! This will not be easy for you guys and I will fight it till the end!— canadiangunner (@canadiangunner) 1548972959.0
The trouble has stoked the fires in what's been an ongoing debate since cryptocurrency's inception.
Is it the way of the future or do the risks outweigh the potential rewards?
Some don't think so.
This is why #cryptocurrency is still not a safe #investment “ The online #startup can’t retrieve about C$190 mill… https://t.co/ArAyEwhWQy— John Hope Bryant (@John Hope Bryant) 1549311206.0
This is why I think cryptocurrency is not ready for prime time! Needs more safety net for the public. Make it dumb… https://t.co/vPNN13qC2w— Canadian Kakashi (@Canadian Kakashi) 1549337537.0
@CNN Eh.... if this, so called, “currency “ actually existed, shouldn’t be a problem.... like this, oh well....— Alexander (@Alexander) 1549370222.0
This is why #cryptocurrency needs regulation. #crypto 🤦🏾♀️🤦🏾♀️🤦🏾♀️ https://t.co/1GSqvMMQU5— VocalTurf 🤔 (@VocalTurf 🤔) 1549332997.0
Regardless, QuadrigaCX has a long way to go in rebuilding its reputation. It's also dealt a significant blow to cryptocurrencies across the board.