According to a report by ZeroNonCense, a cryptocurrency research and consulting platform, the Ethereum [ETH] from the controversial Canadian crypto-exchange QuadrigaCX were deposited in several top crypto-exchanges.
The report claimed that the recipient exchanges were Kraken, Bitfinex, and Poloniex. These claims have also been attested to by Taylor Monahan, the CEO of MyCrypto and Kraken’s Jesse Powell.
A total of 650,000 ETH token were transferred to the aforementioned exchanges, according to the author of the reports. The report suggested:
“Based on the transaction analysis included in the report, it appears that a significant amount of Ethereum (600,000+ ETH) was transferred to these exchanges as a means of ‘storage’ during the years that QuadrigaCX was in operation and offering Ethereum on their exchange.”
QuadrigaCX was in the news after CEO Gerald Cotten, the only person with information on the location of the exchange’s cold wallets, passed away in December. Cotten’s wife, Jennifer Robertson in her affidavit had claimed that Cotten may have stored the cryptos in other exchanges.
The revelation by ZeroNonCense comes after a recent report by Ernst & Young revealed that the exchange’s six Bitcoin [BTC] wallets were inactive since April 2018.
The present report suggested that “thousands of Ethereum,” were moved from a QuadrigaCX hot wallet to a Bitfinex hot wallet. However, the report hesitated in being absolutely certain about the said wallets belonging to QuadrigaCX.
Kraken’s inclusion on this list was attested by a Twitter thread between the author of the report, James Edwards and Jesse Powell. The report suggested that funds were sent between QuadrigaCX and Kraken and the transfers ceased a day prior to Cotten’s death. Edwards described the depositor of the Kraken account as a “pretty consistent depositor.” The author further stated that deposits occurred on the 2nd, 4th, 5th, 6th, 7th and 8th of December, prior to which the last deposit was in July.
One of Powell’s responses suggested that the user depositing the cryptos in Kraken may not have had control over the transfer. He stated,
“Nothing is preventing him from using the same deposit address to fund his Kraken account from many other wallets. If he is sending from his accounts at other exchanges, he almost certainly does not have control of the sending address.”
The report further suggested that a Poloneix hot wallet was sending funds to the QuadrigaCX-owned Bitfinex Deposit Wallet in addition to the above. However, the activity was limited to just one transaction worth 50 ETH or $22,757 on 24 June. Poloneix’s involvement in the debacle was limited, the report suggested,
“This means that the client owner of the Bitfinex Deposit Wallet(QuadrigaCX), also has/had an account at Poloniex and they initiated the withdrawal from their Poloniex account into the Quadriga-owned Bitfinex Deposit Wallet.”
The ZeroNonCense report further suggested,
“Therefore, based on the findings of this report, the next logical step for all involved parties to take would be to reach out to the aforementioned exchanges to inquire about any accounts that QuadrigaCX held at these exchanges and whether there are still funds there.”
Coincidentally, Kraken has offered a helping hand to QuadrigaCX, promising a reward of $100,000 in fiat and cryptocurrency for any information that led to the retrieval of the Canadian exchange’s cold wallets.
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