QuadrigaCX a Canadian exchange missing CA$190 million dollars ($150M million dollars) in crypto assets after the death of the founder of exchange Gerry Cotten, Candian media reports on Feb. 1
The firm has no longer access to the funds and this will lead to the liquidity crisis on the exchange. The exchange only has CA$375,000 ($286,000) in cash, while the total user funds deposited on the exchange are CA$260 million ($198,435,000).
The Exchange claims that the funds are stored on cold wallets secured with a private key in order to protect the funds from hacking. Only the founder of exchange Cotten have access to the private keys, the firm is trying to find a way to access those funds.
Maximum time Cotten stays home and work from his own computer. Cotten's wife, Jennifer Robertson stated that "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.” Jennifer hiring cybersecurity experts to hack into Cotten's computer.
Generally, exchanges funds are secured with multiple private keys that reduce the risk of kidnapping and ransom. Owning an exchange private keys are like walking with millions of dollars.
Recently Cryptopia got hacked and lost funds worth more than $15M. Liqui Exchange will shut down in 30 days. Now QuadrigaCX has no access to the funds. If this winter (bear market) will be long, more exchange and coins going bankruptcy.
We recommend you to store your funds on a hardware wallet or a paper wallet (must have access to the private keys of wallets).
Exchanges are not safe for long term hodling.
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