Altcoin News: 5 Years Ago, the Founder of QuadrigaCX Revealed Where All of Their Private Keys for the Cold Wallets Are Stored
February 18, 2019, by Marko Vidrih on ALTCOIN MAGAZINE
In the course of the investigation into the Canadian cryptocurrency exchange QuadrigaCX, it became known that the founder of the exchange, Gerald Cotten, for some time kept the private keys of cold wallets on paper, printing them out and placing them in a bank box.
During his interview on the “True Bromance Podcast” in February 2014, Cotten spoke about the risks of losing private keys to cold wallets and the impossibility of recovering them:
“It’s like burning cash in a way,” Cotten told his hosts. “Even the US government, with the biggest computers in the world, could not retrieve those coins if you’ve lost the private key. It’s impossible to retrieve those.”
That is why Cotten considered the best method of storing private keys to put their printed copy in the bank box:
“At QuadrigaCX, we’re obviously holding a bunch of Bitcoins that belong to other people who have put them onto our exchange,” Cotten said. “So what we do is we actually store them offline in paper wallets, in our bank’s vault in a safety deposit box because that’s the best way to keep the coins secure.
“Essentially we put a bunch of paper wallets into the safety deposit box, remember the addresses of them,” he said. “So we just send money to them, we don’t need to go back to the bank every time we want to put money into it. We just send money from our Bitcoin app directly to those paper wallets, and keep it safe that way.”
As we reported recently it became known that five more cold wallets of the QuadrigaCX exchange were discovered. However, with all this, the management of the exchange still does not have access to most of them. Moreover, the exchange continues to lose money.
In early February, a Canadian court freed QuadrigaCX from being prosecuted by creditors for 30 days, but according to studies, QuadrigaCX was insolvent long before it stopped working.
Author: Marko Vidrih