Business

Crypto shock for investors after CEO with $145 mn passwords dies in India

Agency | February 07, 2019 12:05 PM

Toronto/New Delhi:  Highlighting the risks in the poorly-regulated cryptocurrency market, death of entrepreneur Gerald Cotten in India who was the owner of Canada's biggest cryptocurrency exchange Quadriga has left thousands of his investors in a quandary.

Cotten who died in a Jaipur hospital in December has plunged Quadriga into crisis and left it struggling to figure out how to refund more than 100,000 of its users as only he had access to $145 million of bitcoin and other digital assets.

With his death, the passwords that can unlock the cryptocurrencies are now gone as his laptop and smartphone are highly encrypted.

"Many of the digital currencies held by Quadriga are stored offline in accounts known as 'cold wallets', a way of protecting them from hackers and Cotten is the only person with access to the wallets, according to the company," CNN reported.

Cotten, 30, died due to complications with Crohn's disease while travelling in India.

"For the past weeks, we have worked extensively to address our liquidity issues, which include attempting to locate and secure our very significant cryptocurrency reserves held in cold wallets. Unfortunately, these efforts have not been successful," Quadriga said in a statement on its website.

Cotten's widow, Jennifer Robertson, said in the affidavit posted online that the laptop that Cotten used to run the currency exchange is encrypted.

"I do not know the password or recovery key. Despite repeated and diligent searches, I have not been able to find them written down anywhere," she said.

The company has hired an investigator to see if any information could be retrieved but ongoing efforts have had only "limited success in recovering a few coins" and some information from Cotten's computer and phone, BBC reported.

The Canadian High Commission in New Delhi told CNN that it was aware of Cotten's death and had "provided consular assistance," but declined to reveal further details.

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