• Wed. Jun 12th, 2024

Bankrupt Quadriga Exchange To Repay 13% Of Each Former Users Claims

Maria Bartiromo

ByMaria Bartiromo

May 15, 2023

Latest reports revealed that bankrupt crypto exchange, Quadriga, is set to pay its former users a portion of their lost funds. Each victim of the collapse would receive 13% of the total funds they claimed to keep with the firm before it failed.

According to the reports, a new public notice was recently issued to creditors of the Quadriga exchange. Quadriga is a Canadian crypto platform currently under bankruptcy court.

According to the notice issued by the giant Ernst and Young (EY) accounting firm, each victim of the collapsed firm would receive about 13.094% of their lost assets after their claims had been verified. 

In addition, Quadriga reportedly owes about 17,648 creditors about CAD 303.1 million (Canadian Dollars). Some of the creditors include Canada Revenue Agency and Canada Post. 

Quadriga To Disburse Funds To Ex-customers 

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As recorded in the report, the bankrupt exchange received claims from 15 separate ex-users who claimed they lost assets worth more than CAD 1 Million. Also, about 28 people claimed assets worth between $500,000 and CAD 999,999. Meanwhile, about 15,356 creditors lost assets worth $100,000 to $0 CAD.

According to the bankruptcy filing, about 87% of the total funds held by the trustee of the collapsed firm are to be distributed as interim dividends. Furthermore, the remaining funds would be kept as liquidity to support future disbursements related to the bankruptcy case. 

When the firm collapsed in 2019, most of the assets held by users of the exchange were swapped to assets’ monetary value in April of the same year.

According to the accounting giant, EY, creditors that claimed to have BTC assets would receive about CAD 6,739 per BTC coin they held. Similarly, ETH holders would reportedly receive CAD 223.44 per ETH coin they lost.

Quadriga Was A Ponzi Scheme: Ontario Authorities

According to the report, Quadriga exchange filed for Chapter 11 bankruptcy in 2019. The announcement came shortly after the CEO of the firm, Gerald Cotten, died mysteriously in India without revealing the exchange’s wallet key, preventing access to customers’ funds 

In addition, the Ontario regulators started probing the firm, seeking the cause of its collapse. Later on, in June 2020, the regulator discovered that QuadrigaCX was a Ponzi scheme and a fraud.

Furthermore, the regulators revealed that Cotten committed previous crimes as he opened several fake accounts for himself and funded them himself. He later used the fake accounts to execute business transactions with unsuspecting customers. 

Consequently, the Ontario Securities Commission concluded that the Quadriga exchange collapse was an outdated fraud scheme garnered with new modern techs.

The bankruptcy case was all over the news when it happened then, as a lot of people fell victim. It was even published in the 2022 Netflix documentary. 

While the firm is ready to disburse money to its former clients, a massive chunk of the bankruptcy money is still untraceable. According to Ernst and Young, they have only been able to retrieve digital assets worth about $34.3 million from the estate.

Back in 2019, Chainalysis, a crypto tracking firm, reportedly said either the missing fund was not received, or it went missing quickly.

In addition, Chainalysis said it still wonders what Quadriga exchange used customers’ funds for.

Maria Bartiromo

Maria Bartiromo

Maria Bartiromo is a renowned news writer and journalist, celebrated for her insightful reporting and authoritative voice. With a career spanning years, she has established herself as a trusted source of accurate and comprehensive news analysis, keeping readers informed on vital global developments.

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