QuadrigaCX, a Canadian cryptocurrency exchange, has lost access to customer funds after their CEO’s death.
The computers hold over US$137 million in virtual currencies for the cryptocurrency exchange. However, the company’s founder and CEO Gerald Cotton died in India last December from Crohn’s disease.
The cryptocurrency stored on QuadrigaCX’s online server has been retrieved.
Unfortunately, no one knows the passwords to his computers so the bulk of the funds, located in offline computers dubbed “cold wallets,” remain locked away.
Cotton did this to keep the cryptocurrency secure from hacks, but he failed to tell anyone else with the exchange his passwords.
The exchange has now gone offline. QuadrigaCX posted a notice telling customers it had lost access to the cryptocurrency reserves and filed for creditor protection with a Canadian higher court in Nova Scotia.
Simultaneously, Jennifer Robertson, Cotton’s widow, filed an affidavit with the court explaining the reasons behind the missen funds.
“The laptop computer from which Gerry carried out the Companies’ business is encrypted and I do not know the password or recovery key,” she said in the affidavit.
“Despite repeated and diligent searches, I have not been able to find them written down anywhere.”
QuadrigaCX is now seeking creditors protection from the court so it can avoid immediate legal action from customers.