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Author Topic: Unofficial Quadriga Cx Thread  (Read 8978 times)
kenzawak
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February 03, 2019, 04:24:56 PM
 #61

Seriously who dies from Crohn's disease ?

https://timesofindia.indiatimes.com/Want-a-fake-death-certificate/articleshow/3218280.cms

And India isn't really the best place for food when you got IBD.  Roll Eyes
The guy is alive or maybe someone (the wife ?) got him killed.





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February 03, 2019, 07:08:30 PM
 #62

More news :

QuadrigaCX Chain Analysis Report (Pt. 1): Bitcoin Wallets

https://medium.com/@zeroresearchproof/quadrigacx-chain-analysis-report-pt-1-bitcoin-wallets-19d3a375d389



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February 03, 2019, 07:28:38 PM
 #63


I've read the article. From what I gather I am assuming they were maybe hacked sometime in the past or the funds were somehow stolen.

Since the crypto market took a downturn, they probably had less customers withdrawing crypto. So by waiting for a deposit to process a withdraw it was possible to get away with it for the past year.

However I think the collapse was when the fiat withdraws had issues and then it scared most people and they finally saw the huge BTC price spread and decided to take all their cryptos out of the exchange and do basically a bank run.

Since there was more withdraws than deposits, it led to this collapse.

From what I read this is similar to what happened with one of the MtGox hacks. They got hacked, and kept silent. They decided to start a bear market since they were the major exchange and when price went from like $30 to $2 they bought back all those lost coins and remained in business.

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February 05, 2019, 12:13:07 AM
 #64

I just got around to reading that.

I don't think they were subject to a hack of their cold storage. If so why not just own it, it's not like things get better by attempting to whether it and hope no one finds out it happened. Odds are you just get hit with a blackmail own the road from the original perpetrators, the proof would be the transaction ID. So the Blackmail would never end.

I do lean more to the falsifying of a cold wallet, especially if at no point in their legal route of registering it was necessary to prove ownership of the coins. This is a pretty big claim and at first glance resembles a Ponzi like scenario. The problem here is that they should have been able to amass a large amount of coins just in the collected trading/deposit/withdrawal fees. This would support the oddly terrifying claim that they hold less than 1000 BTC, which is less than 4% of the claimed amount.

All in all it's just a weird scenario. Quadriga was one of the sources I showed the wife when I entered crypto as a way of legitimizing it in her eyes. Don't think she remembers that after telling her about it the other day. Glad I didn't have any large losses to report in that convo.

Interesting to see what comes out of this after the 5th. It is cool to see the chain analysts going hard at this.

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February 05, 2019, 08:21:38 AM
 #65

No idea if you guys are frequenting the Reddit of this QuadrigaCX scandal but it seems that QuadrigaCX might of been founded by some fugitive back when it went online in 2014.

According to various posts at https://old.reddit.com/r/QuadrigaCX2/

It seems that some guy named Omar who had an alias Michael Patryn was involved in some identity theft, served some jail time and then later became a fugitive before coming into Canada. He and Cotton opened up the exchange in late 2014.

Apparently looking at the timestamps someone documented this over a year ago but it seems nobody listened until now when all this mess started.

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February 05, 2019, 10:49:55 AM
 #66

I do lean more to the falsifying of a cold wallet, especially if at no point in their legal route of registering it was necessary to prove ownership of the coins. This is a pretty big claim and at first glance resembles a Ponzi like scenario. The problem here is that they should have been able to amass a large amount of coins just in the collected trading/deposit/withdrawal fees. This would support the oddly terrifying claim that they hold less than 1000 BTC, which is less than 4% of the claimed amount.

It's possible we're jumping to conclusions too quickly regarding the wallet analysis that's been doing the rounds. There definitely could have been cold wallet addresses that were never used on the network to spend outputs, and those wouldn't have been included in the WalletExplorer address grouping.

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February 05, 2019, 02:13:35 PM
 #67

It's possible we're jumping to conclusions too quickly regarding the wallet analysis that's been doing the rounds. There definitely could have been cold wallet addresses that were never used on the network to spend outputs, and those wouldn't have been included in the WalletExplorer address grouping.

Most times out of ten someone's 'blockchain analysis' turns out to be a load of hogwash. I'm interested to see if we hear more from Kraken about this. They're going to definitely know what's what when it comes to Quadrigacx's addresses.

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February 05, 2019, 04:50:56 PM
 #68

https://cointelegraph.com/news/breaking-lawyers-might-sell-quadrigacx-to-settle-debts

Lawyers Might Sell QuadrigaCX to Settle Debts

"Prosecutors will get the encrypted laptop of recently deceased CEO of major Canadian crypto exchange QuadrigaCX Gerald Cotten, Canadian broadcast network CBC reports Tuesday, Feb. 5.

According to CBC, the laptop that might provide access to $190 million of QuadrigaCX customer funds will be given to lawyers. Moreover, the lawyers are considering selling the company in order to satisfy the debts."



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gentlemand
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February 05, 2019, 04:57:45 PM
Merited by freedomno1 (1)
 #69

This geezer is live tweeting from the court proceedings - https://twitter.com/JackJulian

They seem to be fully on board with the idea of the cold storage being locked up rather than never having existed in the first place.

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February 05, 2019, 05:36:16 PM
 #70

No idea if this is a coincidence or not but if you go to:
https://coinfarm.online/position/

And put in "Patryn" in the Search User for the Bitmex positions, you will see he is a big bear at -6,300,000 position @ $3838.

I wonder if its a different type of Patryn or if Patryn is a common first/last name in the American language.

Maybe he is opening these positions using QuadrigaCX funds but a 6 figure derivatives position is not that large and you would only need around $63,000 in margin at least to open it.

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February 05, 2019, 05:39:29 PM
 #71

No idea if this is a coincidence or not but if you go to:
https://coinfarm.online/position/

And put in "Patryn" in the Search User for the Bitmex positions, you will see he is a big bear at -6,300,000 position @ $3838.

I wonder if its a different type of Patryn or if Patryn is a common first/last name in the American language.

Maybe he is opening these positions using QuadrigaCX funds but a 6 figure derivatives position is not that large and you would only need around $63,000 in margin at least to open it.

I have never heard of another Patryn in my entire life and it's not his real name anyway. It's Omar Dhanani, a fraudster with a long track record.

He's this guy - https://www.reddit.com/user/MikeXBT/

Who regularly popped up on r/bitcoinmarkets talking about his large positions. Looks like a yes to me.

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February 06, 2019, 12:05:58 AM
Last edit: February 06, 2019, 01:14:46 AM by freedomno1
 #72

Posting a backup of the Death Certificate (Spelling Error? Cottan or Cotten?)
(Did a lookup the name checks out under Cottan and shows up on the Indian Death Registry E-Search not sure on how to download a copy though.
 http://pehchan.raj.nic.in/ECertificate.aspx?OWEyMGQ3NTQ=OGQ2OGJmNmI1NTBlYWVkZGE2ODEyNTY=)

Sourced: https://www.coindesk.com/indian-death-certificate-crypto-exchange-quadrigacx-death

Second Source:

https://icoranker.com/gerald-cottens-community-comes-to-his-defense-amid-scam-allegations-gerry-wasnt-that-kind-of-guy?

This geezer is live tweeting from the court proceedings - https://twitter.com/JackJulian

They seem to be fully on board with the idea of the cold storage being locked up rather than never having existed in the first place.

Nice find, Jack from the CBC is a lot more close to the case, i'm glad they decided to hear the case imagines if they had to contact 115,000 Quadriga clients before anything could be done ....

Some questions were addressed and we learnt a few things.

Quick Summary

Physical Presence. They filed in the Nova Scotia Supreme Court since they had no actual presence in BC.

Laptop Status (Cryptocurrency):
Waddell Phillips had the laptop until now (https://waddellphillips.ca/) and an Ex-RCMP Officer tried to access the files and failed.
The laptop is now in the hands of the lawyers, since it may have 180 million dollars on it.
(No mention of trying to backup and clone the laptop before tinkering with it)

Quadriga Plans: Hopes to find the cryptocurrency in 30 days
(maybe find the bank safe with the yubikey, look for usb drives, scan the house for paper wallets the whole 9 yards)

Quadriga Cash: The 25 million is held by third party groups such as Billerfly and New Brunswick companies.
With Quadriga preparing to sell off the exchange and probably go into bankruptcy proceedings.
There may be another 11 million more they can find and access.

Quadriga Costs: Userdata, the website, getting someone to break into the damn wallet, and accounting.

Future Communication: Reddit. (... and not a Globe and Mail Paywall ...)

Privacy: To be decided, keeping client list anonymous except to relevant parties for now.

Website: Remains Shutdown until further notice by the court

Real Public Address to the Cold Wallet: Not Revealed

Legal:
Submissions to court accepted till February 25th monitor submission March 1st
Representative Council will have a hearing on February 14th if Expedited paperwork needs to be submitted by Friday.
CCCA Granted the 30 Day Legal Pause
Creditor Protection Effective until March 7th.

Props to Jack Julian for all the information.

Twitter Highlights

https://twitter.com/JackJulian/status/1092791879199010828
"Quadriga has no office and no bank account. It exists only on a piece of paper in the business registry in BC."

https://twitter.com/JackJulian/status/1092789647934148609
(Apparently lawyers for Quadriga are finding more money all the time. They got word last weekend of a bank that may be holding 11-million in
Quadriga funds.)

(https://twitter.com/JackJulian/status/1092790197123727367)
The laptop was up to now in possession of Quadriga’s lawyers in Toronto. Waddell Phillips. It was being examined by an ex-RCMP computer expert.

https://twitter.com/JackJulian/status/1092789403985104897
Lawyers for creditors like the idea of the laptop which purportedly holds the cold wallets with as much as $180-million in crypto will be secured by a court-appointed lawyer.

https://twitter.com/JackJulian/status/1092790409162559490
It’s now being transferred to lawyers acting for creditors, to eventually be placed in the hands of a court-appointed monitor lawyer.

https://twitter.com/JackJulian/status/1092793208508162049
Five million dollars were held by various New Brunswick companies. Lawyers for Quadriga now control those funds, and will be used to pay for bankruptcy proceedings and negotiate a possible sale of the Quadriga trading platform to satisfy debts.

https://twitter.com/JackJulian/status/1092796116511404032
Justice Michael Wood wants to know what Quadriga’s “ongoing expenses” are. The answer... Costs of storing and protecting the data from the website, even though it isn’t live right now. Expenses for experts who will go find the crypto currencies.

Flashed the Checks (over a stove cough with a non-explained red candle let's call it ambiance)



https://twitter.com/JackJulian/status/1092808652757626883
Discussion about how to alert potential creditors. Chiasson suggests Globe and Mail. But now they are talking about posting notices on *Reddit*

https://twitter.com/JackJulian/status/1092812724483096577
The CCAA order will include posting a notice to creditors in a subreddit. Subreddit TBA. I wonder if they know what a worm can that is...

https://twitter.com/JackJulian/status/1092813077362470912
Quadriga’s website will remain shut down until an order from the court. In order to achieve “some stability”

https://twitter.com/JackJulian/status/1092847703804002304
Back in session. Deadline for submissions to court Feb 25 about possible extension of stay etc. A report from the Monitor will be submitted on March 1.

https://twitter.com/JackJulian/status/1092848965190594561
The judge says the issue of representative council is not urgent enough to rush the timeline. There will be a hearing on that at 0930 on Feb 14, NS Supreme Court.






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February 06, 2019, 12:49:25 AM
 #73

Seriously who dies from Crohn's disease ?

https://timesofindia.indiatimes.com/Want-a-fake-death-certificate/articleshow/3218280.cms

And India isn't really the best place for food when you got IBD.  Roll Eyes
The guy is alive or maybe someone (the wife ?) got him killed.

This is what I said on the other thread about this exchange but they say you can.
I can only see it happening if it was tied together with another aliment. But not on its own untreated.

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February 06, 2019, 12:53:44 AM
 #74

It seems they have taken this article down for some reason. I think medium censors their content and it was something in which they think will be evidence in court to what they published.

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February 06, 2019, 12:59:33 AM
 #75

It seems they have taken this article down for some reason. I think medium censors their content and it was something in which they think will be evidence in court to what they published.

Or it was rubbish? I've no idea.

Medium have been getting way, way more on top with crypto related stuff and are removing things all over the place. It seems fucking ridiculous to me. It's just some writing on a white bit of screen.

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February 06, 2019, 01:20:28 AM
Last edit: February 06, 2019, 01:35:33 AM by freedomno1
 #76

It seems they have taken this article down for some reason. I think medium censors their content and it was something in which they think will be evidence in court to what they published.

Or it was rubbish? I've no idea.

Medium have been getting way, way more on top with crypto related stuff and are removing things all over the place. It seems fucking ridiculous to me. It's just some writing on a white bit of screen.

I never read it either, Just Read
Tracks QuadrigaCx addresses with Chain Analysis
https://www.ccn.com/mycrypto-ceo-quadrigacx-may-not-have-ethereum-cold-wallet-wheres-the-missing-150m

On Medium, think they just don't want to pay people for posting on cryptocurrency, I guess their is always steemit as a place where takedown does not apply just downvotes lol.

Archive:

Site was deleted. Quote from Google Cache:

Quote
QuadrigaCX Chain Analysis Report (Pt. 1): Bitcoin Wallets
Go to the profile of Zerononcense
Zerononcense
Feb 3

This report provides an in-depth analysis of QuadrigaCX’s Bitcoin holdings.

The exposition of this report’s context will be added to the top of this document at a later time in the near future. For the time being, the information provided below will be a collection of all evidence, wallet addresses and other pertinent, relevant facts collected during the investigation of QuadrigaCX’s Bitcoin holdings.
Brief Summary of Findings

Below are the findings made by the author of this report:

    It appears that there are no identifiable cold wallet reserves for QuadrigaCX.
    It appears that QuadrigaCX was using deposits from their customers to pay other customers once they requested their withdrawal.
    It does not appear that QuadrigaCX has lost access to their Bitcoin holdings.
    It appears the number of bitcoins in QuadrigaCX’s possession are substantially less than what was reported in Jennifer Robertson’s (wife of allegedly deceased CEO and Owner Gerry Cotten) affidavit, submitted to the Canadian courts on January 31st, 2019.
    At least some of the delays in delivering crypto withdrawals to customers were due to the fact that QuadrigaCX simply did not have the funds on hand at the time. In some cases, QuadrigaCX was forced to wait for enough customer deposits to be made on the exchange before processing crypto withdrawal requests by their customers.
    After completing the analysis, it is the author’s opinion that QuadrigaCX has not been truthful with regards to their inability to access the funds needed to honor customer withdrawal requests. In fact, it is almost impossible to believe that this is the case in lieu of the empirical evidence provided by the blockchain.

Summary of Investigative Methodology

The investigation involved in-depth research into the Bitcoin, and Ethereum wallets of QuadrigaCX. We will begin with Bitcoin.

Most of the transaction information from customers at QuadrigaCX was aggregated from the following Reddit thread (created by the author):

There is a possibility that there may be fraudulent representations of the author of this research in order to obfuscate/skew information and distort the narrative.

To verify and validate the author’s identity — consult these sources: Twitter, Telegram, and Reddit.

Any information or posts that are not reflected through one of these sources should be seen as illegitimate.
Identifying QuadrigaCX’s Bitcoin Wallet Addresses

Since the wallet addresses for QuadrigaCX were widely unknown, deposit information from customers was aggregated from the Reddit thread posted above as well as information shared through direct message.

At the onset of this endeavor, only 100% verified transactions with the exchange were consulted in order to ascertain more information about QuadrigaCX’s holdings. These initial addresses were verified using personal identifying information from a few select sources that served as volunteers. The original sources also provided substantial proof that they were indeed customers at QuadrigaCX and had initiated deposits with the exchange. Using this information, the author was then able to ascertain a few known locations that QuadrigaCX had used to either store or send Bitcoin.

Once these initial addresses that QuadrigaCX used were verified, they were then used as a baseline to validate all additional information being submitted by the community at large.

All identities of those that contributed information to this endeavor are omitted from this report with respect to their anonymity.

In the process of aggregating information, the following Bitcoin wallet addresses are a small sample of all those that were confirmed to belong to QuadrigaCX:

    36aenge8ZXwjRxHvtbt3HkvJRzxPNnMfeY
    3Hz4NRi2fMZkUrfJXUbYygi5zoo86QXGg6
    3FtVrDgvnhfAiGNHKazmjNwC7kBbT9fktX
    3L4QYoGJfocATAHQz5SXB+FHWbNbMhQjEdA
    358ugsYE2hKDr8Bcyob5TUXgc5n5FHxtjj
    3HVkrkZj7YNscV6KrtaSpWPSGVqVum6RAR
    3FYCpaMxvZ5dX8VCyUwcTkuCvteAUgys3c
    3Bei6hrKrsbE2NTg9gNXwRP6EVPmYcZ7Zx
    3LZfJoPiZGUt5cDAsFwibVFLyjMbq1H2Us
    33x4GqFGJi4fu3WEKNk7qQ6bF3uzyATqS8
    39b59sQb4azPuUdoEXtUL7K2QQLQzC9knT
    3Q8KJEBP58wVK4RDgeuPAKgi5vZQHcUAYu
    3HyNBSg8HjbxUuycfiJ8cU4dfNTYeSrGpA
    3J1ywusNW48i9qAWGeXwh4CURii7ieoZUv
    3NAWo2VV2XSmxckfG8xinrtJ46queEp1w7
    35gtPDp3nvACjLPFg2PC1mXsgfaoYYjFSX
    35r88wsFESp4CXmwKRnXPykTARwWnVH1sq
    3JEasHVpmkn9Vivf1KEhJEXJjrGF1KejpJ
    3MNaurs8trMJmJwZewSB1gY7dmDgCziris
    335hbW2xXygr7rrmoddchYjchzykiYtELw
    3LGgMA2uw6VWyCQ8U2dM6GAaNAKzRr9Wrr
    34hoZWYmv4WnoUDzV4BQvvFAcwUbL54G5X
    36qBVXUpZB8ByHo1cqEyTSRa9V3bSrLdXa
    3PssBQxdXoq2HLrD8W56QZNi7eH2vko4mB
    3KYEyqY2av6PzbAKwJvLsT4wKRPrnsV8Mu
    35pnEcngU5SnRViZNHiAFRqUuXAWJtVBhD
    3FWxEN9ebgnbCvZqLK6mbmZ5f8PAtT4nEJ
    35k2kwnn1Uhk55ZCVUzRpWKrdGeNobYsHm
    3MVfvS31Si4oiK8sTn5TuHt59bQyZUoebM
    34jprabSiFXPiFuDBmzzVwf2B19MiUU6Ld
    3L5t5tzjsgqRbdWVdgBNTQJM48LhhSMf7o

These above addresses (among several others) were saved into an excel spreadsheet. The Google Drive link to this spreadsheet will be spread in the very near future (see note at the bottom of this piece about expediting the release of information for the benefit of customers at QuadrigaCX).
‘WalletExplorer’ (the site) Served as This Report’s Research Basis

The benefit of WalletExplorer is that the original creators were knowledgeable about the Hierchical Deterministic (HD) wallet structure of many of the most popular wallet providers for the Bitcoin protocol.

In fact, WalletExplorer was created and is still ran by Chainalysis. It does not contain the exact same suite of tools, unfortunately, but the same analysis can be performed — it just requires a bit more manual labor.
What are HD Wallets?

HD wallets are built by wallet providers and they come with the added feature of producing/creating millions of different wallet addresses. The purpose of these wallets is to help enhance user security by providing a different, unique wallet address for each transaction that the user makes.
Source: https://coinsutra.com/hd-wallets-deterministic-wallet/

Given the fact that it is more than likely true that QuadrigaCX used such wallets for the management of client funds on their exchange, tracking each wallet on a one-by-one basis would be a futile and infeasible effort.

However, the website, walletexplorer.com, is able to prevent this time expenditure.
How So?

Walletexplorer.com is able to associate wallet addresses with related transactions via a process called ‘address clustering’.

For more information about how address clustering, the following source should prove sufficient:
QuadrigaCX’s Bitcoin Wallet (Clustered Address)

QuadrigaCX’s main ‘hot’ clustered wallet address was determined to be:
Wallet 000009200775868e [WalletExplorer.com]

Want to trace bitcoins with even better tool? Check Chainalysis.com. It has even better detection of wallets, more…
www.walletexplorer.com

This finding was further reinforced and validated by using the transaction information from dozens of customers that had provided over 100 Bitcoin transaction IDs, deposit and withdrawal wallet addresses altogether.

Each one of the wallets listed above were either directly sent to the cluster address or had at least part of the deposited funds sent to the cluster address at some point in time.
Revelations From Analyzing Customer Deposit Information

    None of the withdrawal addresses provided by customers led to a wallet that could be considered anything comparable to a ‘reserve’ wallet.
    The beginning number of the wallet addresses (‘3’) denotes that the wallets used by QuadrigaCX all had multi-signature capability. Whether this security feature was deployed or not, however, is unknown.
    After analyzing the cluster address, there is no indication that QuadrigaCX ever held a substantial amount of capital (>100 $BTC) in their possession.

The key takeaway from the deposit information provided by customers is that QuadrigaCX more than likely never held enough $BTC to account for the customer funds. In the next section, the customer withdrawal information related to $BTC transactions on the exchange reflect that QuadrigaCX was clearly re-routing payments from customers to satisfy withdrawal requests from other customers on their exchange, effectively operating a shell exchange or a ponzi.

Again, more screenshots and walkthroughs of the actual addresses will be provided shortly. For time’s sake and in hopes of providing strong leads for the rest of the community, the aggregated deposit address information from QuadrigaCX customers as well as the discovered ‘hot’ cluster wallet address for QuadrigaCX has been listed so that readers may independently verify this information in the meantime.
Customer Withdrawals from QuadrigaCX

After verifying the cluster address, an attempt was made to locate the existence of a potential cold wallet address.

In order to do so, the author of this study also extracted significant information from customers regarding their withdrawals at QuadrigaCX.

In specific, this section will analyze that withdrawal information and examine conclusions (if any) can be made from it.

Let’s start with a batch of withdrawal transaction ID’s submitted by QuadrigaCX customers. Again, this information was verified independently via chain analysis by checking time stamps, reported amounts, and the flow of transactions from and to known wallet addresses on the Bitcoin protocol, specifically those positively identified as belonging to QuadrigaCX.
List of Withdrawal Transaction IDs (Sample of Verified Transactions; Not the Entire List of Transactions Received and Cross Referenced)

    2e31256d6e5c6b549f4a1a3640e591fd07782115cd5d7037689a24c2cfba4812
    ce754512ae789f630399524477e7cfab8059dcb81130fd9d95fee898118d9d4a
    20c3a34539964e5e13116ec48520f7835ca7c49fe1693f1c2e17abcf96a54f35
    43764980ce045528e4c3297b737c97368925ecb67efda7514a09362899bdec68
    fed9ab175eefe90aa3635c8986c45f50063459050c003c34061d98312ac6feb3
    d3b8c635bd070211df6d9129af5aeb6cc2b46220b68c27b362aae84d8df6130d
    18504732321d6478acd3c91f01096eac6bd327528ab54f4fca6ed162fa7e22e9
    cbe6ab34a527b8a90a227f2ccab84e98c6ed1438f8c5e02db069c8ff0dc66d13
    88f92e37b564c6f7a172b87cb5e5c377334a189722886d0f4a5fb24782af59fd
    6bf41d5ebbc927ded85d202ddd0d1bd837e944868eee8c24e5a10c0d8e3858c2

The above ten transaction IDs were selected from a host of several dozen verified transaction IDs sent by former clients at QuadrigaCX’s exchange and they have been verified independently as well.
Analyzing the Withdrawal Transaction IDs (Bitcoin)

To get a better idea of the methodology that QuadrigaCX employed to send customers requested withdrawal amount of bitcoins, we’ll look at the first transaction ID provided above (2e31256d6e5c6b549f4a1a3640e591fd07782115cd5d7037689a24c2cfba4812)

If we visit https://walletexplorer.com and input this transaction ID, we should see the following screen:
https://www.walletexplorer.com/wallet/72714eea7af9c022

The customer requesting a withdrawal requested the .32737521 $BTC amount in the transaction above.

This is annotated in the screenshot below for convenience:

What is particularly noteworthy in the screenshot above is that the funds were sent from a cluster address that was created no more than 4 hours beforehand.

The first amount shown in the transaction log of this cluster address [72714eea7af9c022] is negligible (0.00679 $BTC). However, the second (1.20771943 $BTC) was not.

Therefore, that cluster wallet was pursued.

The following chain of links were followed:

    https://www.walletexplorer.com/wallet/05e981e66fadc1f0 ; This was yet another cluster address with a relatively small number of bitcoins (1.20811207 $BTC) in it before they were all sent. The last in-flow of currency into the wallet was made on September 28th, 2018.
    https://www.walletexplorer.com/wallet/f69188b0061ce118 ; This cluster address contained only 0.37663 $BTC in it, which was transacted into the cluster address on February 23rd, 2018.
    https://www.walletexplorer.com/wallet/1e0b3ff0013f2b2b ; This link was derived by following the only incoming transaction into the cluster address found in #2.

#3 was most interesting, because it does not appear to be a personal wallet from a customer. . This is indicated by the numerous cluster wallets that have been positively identified as belong to other exchanges via research and verified wallet identifications.
https://www.walletexplorer.com/wallet/1e0b3ff0013f2b2b

Further analysis of the cluster wallet addresses show that it was receiving money from personal wallet addresses belonging to clients or from client accounts on different exchanges. This conclusion was made by analyzing the cluster addresses that had sent funds to the cluster address depicted above. The pattern of transactions in those wallets largely matched those of confirmed customer wallet addresses.

The above analysis led to the conclusion that the overarching cluster wallet that granted the customer their withdrawal request (72714eea7af9c022) was only able to do so after aggregating funds from other customers that had deposited on to the exchange.

More specifically, it appears that the exchange had attempted to create individual cluster wallets for customers at one point in time, yet found itself in a situation (more toward the end of 2018), where customer funds that had originally been apportioned for others were eventually redirected to compensate new customers requesting their withdrawals.

This is evidenced by the fact that the specific TX that was analyzed in this case (2e31256d6e5c6b549f4a1a3640e591fd07782115cd5d7037689a24c2cfba4812) that serves as the base point for examining how a customer received their funds from the QuadrigaCX exchange reflects the following:

    QuadrigaCX did not have a designated hot or cold wallet to send the customer their funds. In specific, they were forced to aggregate funds from disparate, disorganized locations in order to ensure that the withdrawal was successful.
    Since the funds came from various, unrelated customer deposits located in disparate cluster wallet addresses, it is more than likely that bitcoins which were originally apportioned for specific customers had to be redirected in order to satisfy customer withdrawals.

It is worth noting that there is no guarantee that the above analysis represents a factual truth for QuadrigaCX. However, when comparing their withdrawal practices to that of other known solvent exchanges (Coinbase, Bittrex, Bitstamp, Binance, etc.), the movement of bitcoins to satisfy customer demand is highly unorthodox and extremely inefficient for any legitimate exchange.

It is also worth noting that this withdrawal transaction occurred in November 2018, which is within a period of time when the exchange’s financial and functional troubles were at their height.
Customer Complaints Corroborate This Theory

While there are a number of customer complaints with regards to the exchange’s failure to complete fiat withdrawal requests, further research into the exchange’s numerous crypto withdrawal delays seems to corroborate the theory posited above.

The following Reddit posts serves as cogent examples:

The last Reddit thread shown above, specifically, shows responses from several customers that were forced to wait a significant amount of time before receiving their bitcoins (up to a day at times).
The Death of Gerry Cotten (CEO and Owner of QuadrigaCX) Has Not Prevented the Exchange from Accessing its Bitcoin Reserves

After QuadrigaCX shuttered the metaphorical doors on its website on January 28th, 2019, it posted a statement (which is still on the website currently) approximately three days later that stated that the team was looking for its ‘reserve keys’, and that its failure to find said keys has resulted in their inability to fulfill customer crypto withdrawal requests.

Read below:
Source: https://www.quadrigacx.com

The statement above does not attribute the failure to locate the alleged existence of QuadrigaCX’s reserve wallets to Gerry Cotten’s passing, but this is stated in an affidavit from Gerry Cotten’s widow, Jennifer Robertson, later the same day.
Why This Claim Should be Met With Intense Scrutiny

As stated toward the beginning of this analysis, a definitive ID of QuadrigaCX’s main cluster wallet address has already been made via chain analysis and further confirmed through the analysis of hundreds of transactions going to and from the exchange to its customers:
Wallet 000009200775868e [WalletExplorer.com]

Want to trace bitcoins with even better tool? Check Chainalysis.com. It has even better detection of wallets, more…
www.walletexplorer.com

Again, for posterity purposes, below is the link to Bitfury’s research explaining how Hierchical Deterministic (HD) wallets work on the Bitcoin protocol and what features of Bitcoin transactions and wallet addresses make address clustering an extremely reliable method of aggregating addresses belonging to one entity.

Given the above information, it is worth noting that there are several outgoing transactions that have been made since the alleged date of Gerald Cotten’s passing (December 9th, 2018).

Below are numerous examples:
https://www.walletexplorer.com/wallet/000009200775868e?page=2
https://www.walletexplorer.com/wallet/000009200775868e?page=3
https://www.walletexplorer.com/wallet/000009200775868e?page=3
https://www.walletexplorer.com/wallet/000009200775868e?page=3

As one can see in the screenshots above, QuadrigaCX transferred approximately 3.53 $BTC from its platform (approximately $12,381 USD worth) from the evening of January 24th through the 25th.

This movement strongly contradicts the idea that there are no funds that QuadrigaCX has access to.

Of course, the natural counter to this argument would be that the cluster address does not contain the hot wallet.

However, it is worth noting that this cluster address contains over 200,000 wallet addresses that have been used by QuadrigaCX:
https://www.walletexplorer.com/wallet/000009200775868e/addresses
Mt. Gox Connections and Shifty Bitcoin Movements

One cluster address that deserves a significant amount of scrutiny can be found here:
Wallet 006daa655b240256 [WalletExplorer.com]

Want to trace bitcoins with even better tool? Check Chainalysis.com. It has even better detection of wallets, more…
www.walletexplorer.com

It is unknown what the purpose of this wallet is, but it has received significant deposit amounts from QuadrigaCX’s main hot wallet cluster address.

From November 8th to December 8th, this wallet received 760 bitcoins from the QuadrigaCX main wallet address. It is unknown what happened to these bitcoins or why they were moved, but they are no longer in the cluster wallet address.

The cluster wallet was created on May 25th, 2018 and since its inception, QuadrigaCX has sent 3,363 bitcoins to this location.

When calculating the USD value of these transfers (using the estimated value of transaction by multiplying by Bitcoin’s strike price at the time of transacting), it appears QuadrigaCX sent approximately $12.7 million worth of bitcoins to this address over the last 7 months.
Mt. Gox Transfers

If one examines the link provided above underneath the subheading for this section, it is more than likely that the following will be noticeably apparent:

In total, 2,241 bitcoins have come from this cluster address. It is unknown whether the specific wallets that have sent Bitcoin funds into the address have a direct relationship with Mt. Gox, however, this seems to be yet another observation worth noting as well.
QuadrigaCX Has Stated Multiple Times That it Possesses Cold Wallets

One of the more prevalent claims made by QuadrigaCX through their website, interviews/articles, social media, and court filings is that there exists a vast ‘cold’ reserve where a significant number of bitcoins are stored (as well as cold wallets for Ethereum, Litecoin, and the other crypto assets sold on their exchange).
QuadrigaCX Claims on its Website that Cold/Reserve Wallets Do Exist

On their support page, which is still up for the time being, QuadrigaCX posted a message on January 9th, 2018, explaining why there may be delays in receiving Bitcoin transactions.

The message is posted below:

Link to the Support Article: https://support.quadrigacx.com/support/solutions/articles/9000139532-where-is-my-bitcoin-withdrawal-

Archived Link (in case of deletion/removal): http://archive.is/TKwBu

In specific, the statement, “If you have successfully entered your Transaction PIN and Email Confirmation Code to confirm the Bitcoin (XBT) withdrawal from your account, then it will be sent within 10 minutes unless for some reason the hot wallet balance is low and needs to be topped up” implicitly suggests that there is a cold wallet reserve or a more extensive funding source that the exchange would pull from in the instance that its ‘hot wallet’ was bereft of funds.
Gerry Cotten (former CEO & Owner of QuadrigaCX) States on Record That QuadrigaCX Utilized Cold Wallet Reserves

In a now widely shared CoinDesk article, Gerry Cotten, the exchange’s former CEO and Owner that allegedly passed away in India nearly two months ago, stated in an interview with the publication that the exchange engaged in “extensive security measures”.

The excerpt from this CoinDesk article is posted below:
Source: https://www.coindesk.com/canada-bitcoin-exchange-leader-market-turmoil

As highlighted above, the key sentence to focus on in the CoinDesk article is the one where it states, “Cotten, in turn, spoke to Quadriga’s security strengths, noting that the exchange uses multi-signature cold storage to secure bitcoin holdings.”

In specific, many have focused on the ‘multi-signature’ part of the phrase in recent days to make the argument that speculation about Gerry Cotten’s death is a moot point because the multi-signature nature of the wallets would enable QuadrigaCX to still access their funds.

The speculation about why QuadrigaCX may or may not be able to access their crypto funds began because QuadrigaCX has claimed in recent days that they are unable to honor customer withdrawal requests due to the fact that they no longer have access to their reserve wallets.

As a side point, it is worth noting that the highlighted statement in the CoinDesk article only contained a claim made by Gerry Cotten that there was a Bitcoin cold/reserve-wallet, rather than a cold/reserve wallet for all cryptocurrencies offered to traders on QuadrigaCX.
QuadrigaCX’s Recent Court Filings Speculate About the Existence of Cold/Reserve Wallets as Well

Specifically, information about the alleged cold reserves of QuadrigaCX can be found in Jennifer Robertson’s (wife of reportedly deceased CEO, Gerald Cotten) sworn affidavit, which was submitted to the Supreme Court of Nova Scotia (Canada) on January 31st, 2019 in furtherance of QuadrigaCX’s petition for Creditor Protection from the courts.

The full affidavit has been posted on Scribd, and can be accessed below:
Source: https://www.scribd.com/document/398721572/Jennifer-Robertson-Affidavit#from_embed?campaign=SkimbitLtd&ad_group=100652X1574425X640a8d8f2590c81acce9575c8078b8fc&keyword=660149026&source=hp_affiliate&medium=affiliate

Specifically, the following statements (located on page 5 of the affidavit), are of relevance to this section:

    “Any coins credited to a user on the platform were stored by Quadriga, either in a hot wallet or a cold wallet. Coins withdrawn by a user would be stored in a wallet controlled by that user.”
    “Quadriga keeps only a minimal amount of coins on the server (in a hot wallet). The normal procedure was that Gerry would move the majority of the coins to cold storage as a way to protect the coins from hacking or other virtual theft.”
    “The amount of coin kept on the server versus in cold storage was originally set at a fixed amount. Transfers could happen automatically or manually. The threshold requirement for Quadriga’s hot wallet was removed some time ago and, after that, Gerry manually controlled the flow of coins between the hot and cold wallets of the coins credited on the Quadriga platform.”
    “Transfers from the cold wallet to the hot wallet would occur when the hot wallet was running low and withdrawals were being sent to users. The transfer of coins from the cold wallet to the hot wallet was performed manually by Gerry.”
    “There is no defined standard in the cryptocurrency industry for how coins are stored, but the normal practice for any exchange or person dealing in cryptocurrency is to keep the coins in a cold wallet for security purposes.”
    “The database would keep track of useres, and there are currently approximately 363,000 registered users in the Quadriga database. As at the date of filing this affidavit, approximately 115,000 users (the “Affected Users”) of the Quadriga website held balances in their personal accounts, representing obligations payable by Quadriga to the Affected users in the form of: (i) cash obligations; or (ii) obligations to hold cryptocurrency units on their behalf. Quadriga currently owes its Affected Users $70 million, plus cryptocurrency, cumulatively valued (based on cryptocurrency market pricing as of December 17, 2018) at approximately $180 million. Total obligations due to the Affected Users approximate $250 million as of December 17, 2018.”
    “As of January 18, 2019, the following cryptocurrency balances were recorded — Bitcoin: 26,488.59834, Bitcoin Cash: 11,378.79082, Bitcoin Cash SV: 11,149.74262, Bitcoin Gold: 35,230.42779, Litecoin: 199,888.408, and Ethereum: 429,966.0131”

Statements By QuadrigaCX That Have Been Shown to be False (Currently) Through Chain Analysis

In order to protect the author of this study (legally) from any potential legal ramifications, it must be stated that the following statements are not being asserted as empirical truths, but rather observations from the author based on the analysis that they have conducted independently. These statements are not intended as libel, but rather to serve as an accurate representation of fact, to the author’s knowledge, at this point in time.
Potential Falsehood #1 — There is a cold wallet(s) for QuadrigaCX’s Bitcoin Holdings

Based on the analysis of dozens of aggregated wallet addresses and transaction IDs for bitcoin withdrawals and deposits on the exchange, there is no evidence that a cold wallet for QuadrigaCX is currently in existence.

No withdrawal transaction has been sourced to a significant pool of bitcoins (i.e., cluster address) that were not positively identified (objectively) as belonging to another exchange.

In addition, thorough analysis of QuadrigaCX’s main hot wallet cluster address has failed to provide evidence that there has been any movement of bitcoins to an outside wallet address (or cluster address) that contains any significant holding of bitcoins.
Potential Falsehood #2 — QuadrigaCX Has 26,488 Bitcoins in its Possession

Again, via thorough inspection of several dozen verified Bitcoin withdrawals and deposits, the estimated aggregated total number of bitcoins in QuadrigaCX’s possession is south of 1,000 $BTC, with 1,000 being a very generous estimate at this point in time.

Chain analysis shows that the vast majority of holdings in the wallets and addresses that QuadrigaCX owns have already been liquidated or moved to an exchange.
Conclusion

Due to the time sensitive nature of this issue (QuadrigaCX plans on appearing in court Feb. 5th to submit their appeal for creditor protection), this report is being published slightly premature.

There is a lot of additional information from the analysis that the author will include throughout the day (February 3rd, 2019), and in the next few days.

All edits will be annotated at the bottom of the article and announced via all social media platforms owned by the report’s author.

Please feel free to reach out on any of those platforms if you have any additional information or questions about the report. Crowdsourcing reliable information and attempting to make the findings contained within as solid as possible is in the interest of the greater crypto community.

If you’re interested in donating/contributing to the author (this was all done pro bono), feel free to submit a $BTC tip here:

1BxwKqfKFQhq2pyvbbcxfagN2bTK3cBqBs

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February 06, 2019, 06:44:53 AM
 #77

No idea if this is a coincidence or not but if you go to:
https://coinfarm.online/position/

And put in "Patryn" in the Search User for the Bitmex positions, you will see he is a big bear at -6,300,000 position @ $3838.

I wonder if its a different type of Patryn or if Patryn is a common first/last name in the American language.

Maybe he is opening these positions using QuadrigaCX funds but a 6 figure derivatives position is not that large and you would only need around $63,000 in margin at least to open it.

I have never heard of another Patryn in my entire life and it's not his real name anyway. It's Omar Dhanani, a fraudster with a long track record.

He's this guy - https://www.reddit.com/user/MikeXBT/

Who regularly popped up on r/bitcoinmarkets talking about his large positions. Looks like a yes to me.

I've been following that guy on Reddit for the last year on BitcoinMarkets and besides having the same first name Mike vs. Michael, and him commenting on the Quadriga and BitcoinCA reddit from time to time. I don't think its enough evidence to prove it is him.

I guess the fact that he personally knew Gerald Cotton might be a red flag but they could of met at some Bitcoin Conference.

MikeXBT seems like a trader, he made some good calls on stock trades and stock options in the past. No idea if he was trading demo or not but he doesn't seem like the Patryn guy.


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February 06, 2019, 06:22:11 PM
 #78

It was ruled in court that quadrigacx will be covered under the creditors protect act.
Meaning their customers can not sue them for losing their assets in cryptocurrency and money.

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February 06, 2019, 08:26:50 PM
 #79

Official From QuadrigaCx Website

Message from QuadrigaCX
February 5, 2019

Dear Customers,

Today an order for creditor protection in accordance with the Companies' Creditors Arrangement Act (CCAA) was issued to allow us the opportunity to resolve outstanding financial issues that have affected our ability to serve our customers.

We did not enter into this decision lightly. For the past weeks, we have worked extensively to address our liquidity issues, which include locating our very significant cryptocurrency reserves held in cold wallets required to satisfy customer cryptocurrency balances on deposit and sourcing a financial institution to accept the bank drafts being transferred to us. Unfortunately, these efforts have not been successful. Since we were unable to resolve these issues in a timely fashion, we did not want trading to continue on our platform. We filed for creditor protection to help resolve these matters and preserve the interests of our customers.

With this filing, the Court has appointed a monitor, Ernst & Young Inc., an independent third party to oversee these proceedings as we make every effort to address our customer obligations. Filing for creditor protection allows us to work diligently through the process, and to try ensure the viability of our company.

We are sure you have many questions. We are in the early stages of a long process and we do not have all the answers right now. What we can tell you is that the CCAA process will allow QuadrigaCX to keep all options open to attempt to maximize the funds available for the company's stakeholders. We will provide further updates to the extent possible.

Included below is a Q&A, which we hope will address some of the questions you may have at this time.

QuadrigaCX values and appreciates all of its customers and its employees. We thank you for your support and understanding during this challenging time.

A copy of the Order issued by the Supreme Court of Nova Scotia on February 5, 2019 may be found here
https://www.quadrigacx.com/assets/Quadriga_Order.pdf

A motion for the appointment of representative counsel for the affected users of QuadrigaCX will be heard in the Supreme Court of Nova Scotia at 9:30 on Thursday, February 14th. A copy of the Notice of Motion may be found here
https://www.quadrigacx.com/assets/20190206090122682.pdf

Q&A
Q: What does it mean to file for creditor protection?

A: Filing for creditor protection occurs when a business needs time to figure out how it will meet its debt obligations.

Q: Why are you filing for creditor protection?

A: Once it was apparent that we could not access the significant cryptocurrency reserves held in the cold wallets required to satisfy customer cryptocurrency balances on deposit, nor obtain the funds to settle customer currency withdrawal requests, we made the tough but necessary decision to file for creditor protection.

Q: Is there a chance that a solution can be reached to settle customer withdrawals?

A: Over the past weeks we have worked extensively to address our liquidity issues. As such, we are operating under the assumption that a solution will not be reached in the near term, which is why we have filed for creditor protection.

Q: How long will the protection remain in place?

A: Creditor protection is in place for 30-days, with the option to extend.

Q: Why can't you access the coins in the cold wallets?

A: Cold wallets, by their nature, are highly encrypted and were kept off the QuadrigaCX server for security reasons. Gerry took sole responsibility for the handling of funds for QuadrigaCX and as such no one other than him can access the coins in the cold wallets

Q: What steps have you taken to access the coins in the cold wallets?

A: We have hired outside consultants to access these cold wallets. To date, we have accessed a few coins, but not many. Work on that front is ongoing.

Q: Will you opt to extend creditor protection?

A: Our focus right now is the initial 30-days and determining a plan for how to deal with our customer obligations.

Q: Why go through this process when you can just file for bankruptcy?

A: Creditor protection was necessary to protect the interests of our customers. We are exploring a number of options to settle our customer obligations.

Q: Will the website ever be back online?

A: We have taken the website offline while QuadrigaCX is in the CCAA process. It is expected that all account balances on the platform existing as of the date of filing will be dealt with through the CCAA process. Together with the Monitor, the company will determine if it is feasible to restart the website and will seek the court's authorization to do so if appropriate at a later date.

Q: Can I still access my trading history and account information even though the website is inactive?

A: Each customer's trade history will be preserved.

Q: Who can I contact with regards to the status of QuadrigaCX's CCAA process or make a comment?

A: Ernst & Young is appointed by the Court as an independent third party to monitor the proceedings and can be contacted at quadriga.monitor@ca.ey.com

Q: Will you provide a further update?

A: We will provide updates to the extent possible. Public materials filed in relation to our CCAA administration will be available via the Monitor's website at www.ey.com/ca/quadriga
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February 06, 2019, 11:06:19 PM
 #80

There is a theory he ran another exchange called Midas gold back in 2008 with a guy by the name of Omar Dhalini.
I think they planned this setup and exit all along. Could be Gerald was the fall guy and Omar is the one who has control of the funds by multi-sig wallets. And is just waiting until the heat is off the bitcoin but is moving small amounts of litecoin as others have followed those transactions.
This theory is explained in this video by coinspice.
https://www.youtube.com/watch?v=tiy1K6-mf4s

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