By
Temitope Olatunji
April 24th, 2024
Miller Thomson, the law firm representing QuadrigaCX stated that a small number of affected users are likely to receive notice of Disallowance of Claim.
In a post earlier this week on May 8, Miller Thomson, a law firm representing the users of defunct cryptocurrency exchange QuadrigaCX announced that they would start an interim distribution of funds linked with the exchange’s bankruptcy proceedings in the coming weeks.
As per the bankruptcy trustee Ernst and Young, this interim distribution would be in consultation with estate inspectors. Very soon, the trustee will also post a Notice to Affected Users with the details about the manner and procedure of the distribution.
Law firm Miller Thomson stated that a small number of affected users are likely to receive notice of Disallowance of Claim, which means that the creditor’s claim has been either revised or disallowed in the bankruptcy process. The law firm explained:
“If you received a Notice of Disallowance, you have the right to appeal the decision . The first step is to review the reasons for the revision or disallowance and gather any necessary evidence to support their claim. In this case, the Trustee is most likely to have issued a Notice of Disallowance if there was a discrepancy in your proof of claim.”
The Fall of the QuadrigaCX Crypto Exchange
Once the largest cryptocurrency exchange in Canada, QuadrigaCX became insolvent back in February 2019 soon after founder Gerald Cotton died in India while taking along the private keys of QuadrigaCX’s offline storage systems.
Later, as estimated by the Ontario Securities Commission (OSC), QuadrigaCX owes its clients an estimated $160 million. Along with losing access to the cold storage, the OSC has also alleged that Gerald Cotton had realized $86 million in crypto trading losses on the QuadrigaCX platform.
In 2020, Jennifer Robertson, the widow of QuadrigaCX founder Gerald Cotten confirmed that she will hand over more than $9 million (12 million CAD) in assets. Over the years, bankruptcy trustee Ernst & Young recovered $34.3 million worth of assets. The OSC wrote, “We did not identify any other assets beyond those identified by Ernst & Young.”
Over the fall of QuadrigaCX, online streaming giant Netflix is planning to release a documentary on the entire episode. However, there haven’t been many details regarding this so far.
Crypto exchange bankruptcies have shot up recently in the current market scenario especially after the US SEC initiated a major crackdown on crypto trading firms, especially after the fall of crypto exchange FTX.