Creditors tussle among themselves in QuadrigaCX payout battle
QuadrigaCX creditors are adamant that they get the first preference when the exchange begins the payout. An exclusive report from CoinDesk indicates that a fight has begun between the creditors of QuadrigaCX regarding the payout.
Customers are approaching lawyers to build a case against the exchange, stated the report citing sources. The exchange was granted creditor protection by the Nova Scotia court for 30 days after a hearing conducted on February 5.
“There seems to be a conflict going on between creditors themselves,” a source cited in the report. An unofficial telegram group called QuadrigaCX is brimming with arguments from both creditors. Arguments revolve around customers of the exchange who should be given priority while payout.
QuadrigaCX creditors are a mix of crypto holders and fiat holders. The fight is about who gets the money first. Crypto holders have pointed out that they form a majority of the creditors so they should be paid back first. However, fiat holders argue that any such preference would be unfair.
A source cited in the report that people who are waiting to receive fiat withdrawals have received an email from the company stating that their money has been sent to payment processors. One of the fiat holders, Zou, argued that “from a legal standpoint you could argue that this money is not even Quadriga’s from that point and that we could be seen as trustees rather than creditors.” “Of course people who hold more crypto … will end up getting less if this happens, so I don’t see this happening,” Zou added, according to the report.
Customers are not hopeful of getting a full refund. However, the assets that were said to be found by the company after the company declared its lost keys situation is greater than the debts owed by Quadriga.
QuadrigaCX, the Canadian crypto exchange, fell into a quagmire after the death of its CEO Gerald Cotten which left $215 million user funds trapped in his laptop. Cotten’s wife Jennifer Robertson confessed that she did not know the password or the recovery key to unlock the laptop. The firm declared that they couldn’t access the funds because they were kept in cold storage on Cotten’s laptop to which he had the sole access.
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