Japanese Crypto Exchange Coincheck Resumes Trading in XRP and FCT

Siamak Masnavi

On Monday (26 November 2018), the Japanese financial services company Monex Group, the owner of the Japanese crypto exchange Coincheck, announced that the exchange had now resumed trading of XRP and FCT.

Coincheck, which according to CNBC, lost around 523 million NEM tokens (worth approximately $534.8 million at the time) in an attack that occured on 26 January 2018, was acquired by the Monex Group on 6 April 2018. Back in April, Monex's press release explained how the company hoped to help Coincheck provide a much more secure environment for the exchange's customers:

"We aim to build a secured business environment for customers by fully backing up Coincheck's enhancement process. Specifically, we will maximize the use of our expertise and human resources of business administration, system risk management, and customer asset protection system that we have cultivated since the establishment in the online securities industry. We will support Coincheck to provide secure environment to customers and to grow sustainably as a socially valuable cryptocurrency exchanger."

Today's press release from Coincheck said that the exchange had "resumed depositing and purchasing services for XRP and FCT." It explained that:

  • "Coincheck had suspended certain services in order to protect the integrity of customers' assets and to investigate the cause of the breach to its system on January 26, 2018."
  • "Since then, Coincheck had been working to improve its management structure and internal control by carrying out business improvement plans."

Furthermore, it said that, as of today, the following services were available:

  • "New account openings (Domestic residents only)"
  • "Depositing , purchasing , remitting and selling cryptocurrencies"; (BTC, ETH, ETC, LTC, BCH, XEM, LSK, FCT, and XRP)
  • "Depositing and withdrawing JPY"
  • "Making settlements and margin deposits/withdrawals on existing leveraged transactions"
  • "Cryptocurrency lending service"

At press time, according to data from CryptoCompare, XRP is trading at $0.3559, up 2.41% in the past 24-hour period.

Featured Image Courtesy of Coincheck

QuadrigaCX Has Sent Its Remaining Crypto to 'Big Four' Ernst & Young

The embattled Canadian cryptocurrency exchange QuadrigaCX has recently sent the remaining cryptocurrency it had in its hot wallets to ‘big four’ auditor Ernst & Young, which has been monitoring the proceedings in its creditor protection case.

According to an official report Ernst & Young released called the “Second Report of the Monitor,” QuadrigaCX sent nearly all its cryptocurrency to the auditor on February 14, after conducting a few test transactions to make sure it wouldn’t send them to the wrong address.

In total, the cryptocurrency exchange transferred 51 bitcoin, 952 ether, 822 litecoin, 33 bitcoin cash, and 2,033 bitcoin gold to the auditor. At press time, these cryptocurrencies are worth little over $410,000, an amount Ernst & Young is set to “hold the cryptocurrency in cold storage pending further order of the Court.”

The test transaction QuadrigaCX has made are notable, as earlier a costly blunder saw it inadvertently transfer 103 BTC ($468,000) to its cold wallets. The exchange has been unable to access its funds in cold storage since its founder and CEO Gerald Cotten unexpectedly passed away in India.

Ernst & Young’s report has also given the exchange’s creditors updates on its fiat holdings. It notes there are thee main sources: a payment processor called Costodian that holder about $25 million CAD in bank drafts, Stewart McKelvey which holds about $5.8 million CAD in bank drafts, and other amounts held by various third-party processors.

Costodian has reportedly already transferred about $20 million CAD to Ernst & Young, but is holding onto the remainder, and has claimed QuadrigaCX owns it $778,000 CAD in processing fees.

$145 Million Locked Away

The Canadian cryptocurrency exchange, as mentioned above, has been locked out of its cold storage wallets since its founder and CEO passed away, as he managed the operation through his laptop.

His wife Jennifer Robertson has since filed an affidavit where she revealed Cotten was single-handedly managing the exchange’s transactions, and that after he passed away no one was able to do so. Since then, the Supreme Court of Nova Scotia has granted QuadrigaCX creditor protection, and appointed Canadian law firms Miller Thomson and Cox & Palmer to represent its customers in the upcoming proceedings.

As CryptoGlobe covered, QuadrigaCX has already run out of funds, and a look into Cotten’s way of managing the exchange in the past has suggested users’ funds can be stored in paper wallets. The exchange’s downfall has cost at least one cryptocurrency enthusiast his $420,000 life savings.

Notably, blockchain researchers have released data that suggests QuadrigaCX didn’t have any funds stored in cold wallet, and even found suspicious transactions to other exchanges, including Poloniex, Bitfinex, and ShapeShift.