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A dormant bitcoin wallet belonging to a controversial exchange (no, not the exchange) woke up this weekend on QuadrigaCX. Over 100 Bitcoins associated with defunct exchanges have been moved from cold wallets previously thought to be inaccessible to anyone.
QuadrigaCX, for those unfamiliar, is an exchange founded by Gerald Cotten and the subject of the enchanting Netflix drama Trust No One: The Hunt for the Crypto King. He was one of the early mainstream exchanges, at one point handling more than 80% of his Canadian Bitcoin volume. The only thing is it was all a scam.
The company filed for bankruptcy in 2019 and owes nearly $200 million to customers. Later revealed to be a Ponzi scheme, Cotton opened an account under a false name, credited himself with fictitious balances, and traded with unsuspecting customers. He lived a double life all his life, and the exchange was just the frontier of an old-fashioned Ponzi scheme.
Big 4 company Ernest & Young (EY) is a bankruptcy trustee and provided an additional layer of conspiracy when the company reportedly accidentally sent 100 bitcoins to an inaccessible wallet.
On February 6, 2019, Quadriga inadvertently transferred 103 bitcoinsto a Quadriga cold wallet that we currently do not have access to. If so, we get this cryptocurrency from various cold wallets.
Of course, the reason this wallet was not accessible was that CEO Cotten died under mysterious circumstances while traveling, spawning a million conspiracy theories. It appears that he was the only one with keys to offline wallets containing cryptocurrencies.
This weekend, a cold wallet that received 100 BTC in 2019 suddenly became active again.Sent 36 BTC from this wallet to 33 BTC this purse, which were two of the largest transactions. But more interesting than the amount is the destination. The coins were sent to the mixing service Wasabi, a cryptocurrency mixing service that obfuscates the origin and destination of cryptocurrency funds.
So how’s Gerald Cotton digging into his Bitcoin savings?
Magdalena Gronowska, a bankruptcy inspector and member of Quadriga’s creditors panel, said the funds were not moved by EY. According to a previous EY report, only Cotten had access to the wallet.
Honestly, no one knows. This is another layer of mystery to a story that is already as bizarre, confusing, and seedy as it can be. about it. Now, the coins that were supposedly under his sole control (i.e., assumed lost given his passing) are in motion again.
So either Cotten is alive or someone else has access to those wallets. But if the actor is a legitimate person, let me ask. Why are they sending funds to a mixing service?
