QuadrigaCX Traders Await Rescue by Canadian Regulators

QuadrigaCX Traders Await Rescue by Canadian Regulators

The regional securities regulator of British Columbia might have abandoned users of troubled crypto exchange QuadrigaCX but the Ontario Securities Commission (OSC) may yet save the situation as it confirmed the start of its investigations into the scandal in a Reuters article.

QuadrigaCX owner Gerald Cotten passed away unexpectedly last December, taking along with him the private key to an offline wallet, that held more than USD 190 million worth of traders’ funds in cryptocurrency.

An OSC spokesperson did not confirm the investigation but said, “Given the potential harm to Ontario investors, we are looking into this matter.”

Although Canada does not have a wider crypto regulation, it has taken actions against illegal forms of financial activities, including stopping ICOs that violated security laws. Allan Goodman from Goodmans LLC, a prominent technology company, asked: “Should (QuadrigaCX) have been registered as an exchange and were any securities laws breached with respect to the trading of the coins on the exchange?”

Given the authorities have yet to have a broader coverage of crypto and related financial services, the British Columbia Securities Commission had said earlier that the case was outside its scope of authority: “[BCSC] does not currently have any indication that QuadrigaCX, the crypto asset trading platform, was trading in securities or derivatives or operated as a marketplace or exchange under British Columbia securities laws.”

However, with OSC now saying it is looking into the issue, there appears to be some hope for traders to get their investments and money recovered.

Cotten was the only person who had access to the main wallet on his laptop, which stored most of the exchange’s digital currencies. With many traders accusing it a scam and fraud, they turned towards the courts, but a judge gave the exchange a 30-day stay to try and access the wallet to return traders their funds.

 

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