QuadrigaCX has officially filed for bankruptcy
After repeated attempts to find a resolution, the Canadian exchange is no more
The Canadian courts tried, Ernst & Young (EY) tried, even a number of cryptocurrency security specialists tried. However, it appears that nothing was able to save the QuadrigaCX exchange from sinking. The Canadian exchange has now officially entered bankruptcy, charting a new course toward trying to find restitution for its users.
The bankruptcy allows the company to be restructured in accordance with the Bankruptcy and Insolvency Act. The switch to bankruptcy had first been proposed by EY, and the move will see the auditing giant take over as trustee with the powers necessary to request documentation and evidence, including testimony, without requiring the court’s intervention.
QuadrigaCX reportedly still owes more than $50 million to its users and even more to creditors. Much of the cash has been locked up in bank drafts and third-party payment processor accounts, and EY has been hoping to gain access to those funds to help resolve the QuadrigaCX debacle. In light of the bankruptcy approval, which was issued this past Monday, several of the payment processors have complained about the short notice and the lawyer for one of them asserted that EY doesn’t have the authority to act as a trustee.
The judge presiding over the ordeal, Nova Scotia Supreme Court Justice Michael Wood, has always been more sympathetic to the plight of the users than to those reportedly holding the funds. It has repeatedly sided with EY in its attempts to bring everything to a close and, if the paperwork is in place, there’s no reason why the payment processors would be so hesitant to cooperate, unless they have ulterior motives.