QuadrigaCX, the bankrupt Canadian cryptocurrency exchange, has announced that it will begin an “interim distribution” of funds to creditors. This development comes despite only a fraction of the missing funds being recovered from the estate. The announcement was made in a status update from law firm Miller Thomson.
According to the update, a Notice of Disallowance may also be sent to some QuadrigaCX users, informing them that their claims have either been revised or rejected. Affected users are advised to check the update for further details on the next steps to take.
The case of QuadrigaCX has been widely publicized in recent years. The exchange filed for bankruptcy in 2018 after its CEO, Gerald Cotten, passed away under mysterious circumstances, taking the only known private keys to the exchange’s wallets with him. The case was the subject of a popular 2022 Netflix documentary.
Although some of the funds owed to the exchange’s customers will now be paid back, a significant amount is still missing. Bankruptcy trustee Ernst & Young has only recovered $34.3 million worth of crypto from the estate so far. The Ontario Securities Commission estimates that QuadrigaCX owes its customers $160 million.
In conclusion, while the announcement of an interim distribution of funds is a positive development, there is still a long way to go before all creditors are fully compensated. The case of QuadrigaCX highlights the importance of safeguarding private keys and the potential risks involved in using centralized cryptocurrency exchanges.
