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.

Facebook Libra Cryptocurrency Unveiled; Yet Another Ban for U.S. Crypto Investors

The top daily news from the cryptocurrency and blockchain space:

  • Social media giant Facebook introduces Libra cryptocurrency, Libra Blockchain, and Calibra.
  • Multiple regulators voice concern over Libra and Libra Blockchain.
  • Bancor bans U.S. users from its web application.

At the time of writing, bitcoin (BTC) and ether (ETH) are trading at $9,169.6 (+0.1%) and $267.7 (-0.3%), respectively. As for the MVIS CryptoCompare Digital Assets 10 Index, it is currently tracking at 4,283.8 (+1.8%).

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Facebook Libra Cryptocurrency, Calibra Unveiled

Facebook announced its plans to roll out a new price-stable cryptocurrency called Libra. Libra is governed by a Geneva-based not-for-profit entity known as Libra Association. While Libra will start out running atop a public-permissioned blockchain, it will, over time, transition to a public-permissionless blockchain.

The Libra Blockchain was described as follows: "a decentralized, programmable database designed to support a low-volatility cryptocurrency that will have the ability to serve as an efficient medium of exchange for billions of people around the world."

French, U.S. Regulators Decry Facebook Libra Cryptocurrency

Just hours after Facebook’s announcements relating to Calibra and Libra, French finance minister Bruno Le Maire called for the Group of Seven (G7) central bank governors to review Facebook’s Libra token, alleging it cannot and “must not happen.”

Soon after this, Patrick McHenry (R-NC), the senior Republican on the U.S. House Financial Services Committee, penned a letter to Chairwoman Maxine Waters (D-CA) requesting a hearing on Facebook’s new cryptocurrency project. Waters later voiced her agreement; requesting Facebook agree to a moratorium on the development of Libra.

Also voicing their discontent with the yet-to-be-launched blockchain initiative by Libra was U.S. Senator Sherrod Brown (D-OH), the Ranking Member of the Senate Banking Committee, who tweeted his opinion that the U.S. government “cannot allow Facebook to run a risky new cryptocurrency out of a Swiss bank account without oversight.”

U.S. Users Banned from Bancor Web App

Bancor – a decentralized liquidity network that provides users with a simple, low-cost way to buy and sell cryptoassets directly through their wallets – announced that “beginning July 8, 2019 (09:00 AM EST) US citizens, domicilaries or users from US IPs (Internet Protocol addresses) will no longer be able to use Bancor’s web application, bancor.network, to convert tokens.” All other functionalities will remain available, Bancor confirmed.

Addressing what led Bancor to enforce this restriction on U.S.-based users, the company said that the “decision has been made in light of increased regulatory uncertainty” in the U.S. The move is largely similar to that of Binance's, which recently banned IP addresses from the U.S. – along with twenty-eight other countries – from accessing Binance.org, the primary gateway to Binance DEX.