Altcoin News: Traces of Assets Missing from QuadrigaCX Lead to Poloniex and Bitfinex Exchanges
March 4, 2019, by Marko Vidrih on ALTCOIN MAGAZINE
Researchers from Zerononcense claim that they were able to track down the cryptocurrency missing from QuadrigaCX. According to the report, 649,708 ETHs from the crypto exchange were on the Poloniex, Bitfinex, and Kraken.
However, Kraken CEO Jesse Powell said that his company does not have assets withdrawn from the exchange. In addition, on Thursday, the Kraken cryptocurrency exchange announced that they are ready to pay a reward of $100,000 for providing information that could help discover the assets of the Canadian exchange QuadrigaCX.
Researchers from Zerononcense believe that there is a high probability of finding funds derived from QuadrigaCX on the Bitfinex and Poloniex exchanges.
In specific, the address 0x0ee4e2d09aec35bdf08083b649033ac0a41aa75e sent significant funds to the Quadriga-owned Bitfinex Deposit Wallet
This wallet, in specific, has been determined to be a former cold wallet address for QuadrigaCX.
Taylor Monahan, founder of MyCrypto, as well as the firm, Elementus, positively identified this wallet as belonging to QuadrigaCX as well.
In total, the QuadrigaCX Cold Wallet sent 13,819 Ethereum to the Quadriga-owned Bitfinex deposit address, worth a total of $775,997.52 at the time of transfer (four transfers in total).
The QuadrigaCX Cold Wallet also sent 4,000 Ethereum ($1.9 million worth at the time of transfer) to 0x185a3c26a1a5deb37c7fd02007b0fde19db61df3, which was subsequently sent directly to the Quadriga-owned Bitfinex address.
Allegedly, the latest transactions from the alleged purses of Ethereum Exchange were carried out on December 8 last year. Recall that the founder of the exchange Gerald Cotten died on December 9.
“The date of the last transaction from these wallets is of interest because the owner of QuadrigaCX died the day after the transfer was made,” the researchers write.
Powell said that QuadrigaCX users have a chance to get their money back if they can find it in the accounts of third-party exchanges. However, information on incoming transactions, which are presented in the Zerononcense report, does not guarantee that cryptocurrency assets are still located on the named sites. Powell said:
“For exchange customers, this is the main opportunity to get their money back. Unfortunately, at Kraken, Cotten did not store anything. It is hoped that other sites will check their wallets and find QuadrigaCX money. At the same time, it will be necessary to dig deeply, because accounts registered with other names could be used. The exchanges should check the addresses from the report and find the correspondence with the addresses of their clients that were used for entering and withdrawing cryptocurrency. Then you need to figure out whether these clients have a connection with QuadrigaCX. ”
Like Powell, Monahan believes that Cotten could register accounts at third-party sites using his clients’ data.
“It is worth remembering that Quadriga served the exchange, whose users underwent the procedure of identification. The exchange has a lot of KYC data and there is a possibility that accounts were registered using this data. ”
Ernst & Young research
In addition, on March 1st, in the framework of the trial on the QuadrigaCX cryptocurrency exchange, the auditing company Ernst & Young (EY) published the “ Third Monitoring Report ”.
EY managed to detect six cryptocurrency wallets, which were used by the management of the exchange, mainly for the storage of Bitcoins. If you do not take into account the erroneous transaction committed in February, no funds were received on these wallets since April last year, and only 104 BTC are at these addresses, which were sent in February. It turns out that the 26,350 BTC, which the company owes to its users, are stored elsewhere.
“To date, it was not possible to find out the reasons why, in April last year, Quadriga stopped using the identified addresses for deposits. The registrar and the managers will continue to work in this direction and study the stock exchange database in order to obtain additional information, ” the report says.
At the same time, EY does not report whether it was possible to find any other cold wallets for storing Bitcoin or other cryptocurrencies owned by the company.
The investigation was able to establish 14 user accounts that could be created to bypass the standard Quadriga procedure under various names. The report notes:
“The accounts that were found were created internally without notifying the relevant customers. They were used to trade on the Quadriga platform. At the same time, there is a possibility that some of these accounts were deposited without making appropriate deposits, but they also participated in the trading process on the Quadriga platform.”
The audit company contacted representatives of other cryptocurrency exchanges in order to find out whether Cotten kept cryptocurrency on their sites. Some of these exchanges confirmed that he used their services.
The company also tried to obtain information on account balances and access to other data stored on Amazon Web Services cloud servers but was refused.
“The information of interest is on a personal account registered in the name of Gerald Kotten. AWS cannot provide registrar access to it in order to obtain a copy of this data.”
However, the auditor is confident that the information from the AWS cloud servers can help in the further investigation, so they appealed to the court with a request to make a decision on the opening of access.
Author: Marko Vidrih
