QuadrigaCX: Opinions and Sources

Image Source: PrestonMartelly.

[NOTE (7 April 2020): Updates on this post after March 2019 were interrupted by the hospitalization and subsequent death of a family member. If I update information on Quadriga, they will appear in new posts.]

This blog will embark on a larger exploration into decentralized institutions and how they are relating to mainstream institutions, governments and globalism. To support that research, this post will feature links, opinions, and sources on the QuadrigaCX crypto exchange collapse. See my initial post on QuadrigaCX's meltdown, here.

Horrific stories involving QuadrigaCX emerging.

A former US-based software engineer lost $422,000, all of his savings he gained working 7 years to move back to Canada.

He sent crypto to Quadriga, filed withdrawal in October, hasn't received the money.https://t.co/zoLMnkU4Yz

— Joseph Young (@iamjosephyoung) February 9, 2019

11 February 2019: TRON CEO Justin Sun offered a job to QuadrigaCX client Tong Zhou who lost $422,000 on the exchange. Image Source: UToday.

Tong Zhou was an ex-@BitTorrent employee and I am saddened by the news of the loss of his life savings in Quadriga CX's digital EX. I sympathize with his predicament and would like to hereby extend an offer to him to once again return to #BitTorrent. #TRON https://t.co/TFh41DWD77

— Justin Sun (@justinsuntron) February 11, 2019

Vlog - QuadrigaCX, how I lost my life savings, how I am dealing with it so far.. (15 February 2019). Video Source: Youtube.

By the second week of February 2019, the picture of QuadrigaCX as presented by CEO Gerald Cotten's widow, Jennifer Robertson, began falling apart under scrutiny of different cryptocurrencies' blockchains. See the 'Blockchain Forensics' section below in this post for details.

Social Media Innovation:
Crowd-Sourced Truth and Justice

In an innovative twist, Quadriga's users banded together on social media in early February 2019 to change the narrative. Instead of the funds being automatically lost, they set out to discover the truth about the exchange, because this affair is possibly "just the tip of the iceberg" in the cryptosphere and beyond it.

Together, Quadriga's users are launching their own investigation and are slowly turning the tide of opinion, first in the establishment, which refuses to touch the crypto space or treat it as a legitimate enterprise. On 8 February 2019, Reuters reported that Canada's biggest securities regulator (the Ontario Securities Commission) was looking into QuadrigaCX and cooperating with an RCMP investigation.

Second, Quadriga's users may sway the crypto sphere, where conventional wisdom and cynicism take lack of trust for granted; anyone who leaves fiat or crypto on an exchange is considered a fool who got what is coming to him or her. Some crypto users would rather look the other way and look at this crime as a non-issue. Quadriga is a transitional test case for mainstream adoption; thus, complacency in crypto circles about the collapse of this large exchange and crimes committed therein will affect that space over the long term.

Unfortunately, it appears that there was a difference between what Quadriga seemed to be and what it really was. Informal investigations and unconfirmed and dodgy information related to Quadriga are listed in the 'Theories' section near the bottom of this post.

On 7 February 2019, Quadriga's users set up a Wiki, qcWiki.org dedicated to their online investigation. Declaring that they were seeking "Crowd Sourced Truth and Justice," the site's founders stated:

"The events surrounding QuadrigaCX are extremely suspect; the official story simply doesn't make sense. As things stand, we're left with a mix of facts, rumors and hearsay. This wiki has been created to organize and verify facts. It will help eliminate the spread of misinformation, bring clarity to those interested in following the case and help law enforcement with their investigation.

If you have information/evidence of potential crimes committed by QuadrigaCX or individuals associated with it, you can contact RCMP Toronto West who are currently investigating.

Phone: (905) 876-9500

Website: Toronto West (Milton)

This is insane, but we’re coming in to help the community. The global crypto ecosystem is coming in to help, stay tuned

— Joseph Wein₿erg ⚡️ (@josephweinberg) February 11, 2019

We were actually discussing (on Reddit) a crowdfund campaign for the legal costs of any contractors who wish to be transparent & speak out. I think this may be a good idea. https://t.co/OnwdDu4EB9

— Mitch Airey⚡ (@MitchAirey) February 11, 2019

PROTEST UPDATE(1/3):
We're working diligently to ensure all hands are on deck in both the planning and execution of the protest on March 5, 2019 in Halifax, NS.

Help plan: https://t.co/O8HydZzW3O
Announcements: https://t.co/kRk6y5DdW6

— Mitch Airey⚡ (@QuadrigaCXed) February 22, 2019

-This post will be continually expanded and updated in chronological order and will serve as a resource and links dump for researchers. Suggestions are welcome in the comments below the post. Over time, I will try to make it as complete as possible.

Stateless Futures: Crypto, Quadriga, and Anarchy in Acapulco

Court photograph showing Quadriga's book-keeping system; incredibly, the published photograph reveals personal and business data. Image Source: Twitter via Reddit. You can follow updates from Quadriga here.

On the heels of the Dark Overlord 9/11 hacks and bitcoin ransoms, the primary and most reputable Canadian cryptocurrency exchange, QuadrigaCX, has melted down over the past two months after its missing 30-year-old CEO 'died' (or maybe, 'did not die') on 9 December 2018. He supposedly was the only person who had the passwords to the company's cold wallets. A dig into Quadriga reveals interests in charitable orphanages (human trafficking?), e-gold, and money laundering.

The crypto exchange has filed for court protection, which was granted by the Supreme Court of Nova Scotia. As of 5 February 2019, Quadriga has a 30-day stay of proceedings to stop lawsuits from its clients and account holders. The company has to find CAD $250 million in that time. Third-party observer Ernst and Young will oversee the process; they are publishing relevant documents here.

From the story: "It appears #Quadriga transferred customer funds to other #cryptocurrency exchanges, although it isn’t clear what might have happened to the money from there." Curiouser and curiouser. https://t.co/OpPmaUQpvK via @WSJ #Crypto #CryptoNews #cryptocurrencynews

— David G Zeiler ⚡️ (@DavidGZeiler) February 6, 2019

Agreed. An independant analysis made on my side confirms several elements from this article. So far, it seems likely that QCX's "cold wallet" was actually a set of accounts opened on others exchanges (Kraken, Huobi, Binance, etc) and controlled by G.Cotten (or someone else).

— LaurentMT (@LaurentMT) February 3, 2019

We know from court docs that 15.62074542 BTC was transferred to Quadriga hot wallet from Gerrys phone on January 15th, lets hunt down the TX and we will have a confirmed Gerry personal address #quadriga #QuadrigaCX @ProofofResearch pic.twitter.com/Dy9NnSVyf4

— DogePreacher (@DogePreacher) February 6, 2019

#QuadrigaCX #QuadrigaCXscam Scammers Scammers!!!!!! It was a new wallet, there was 1 transaction. I transfered 0.47BTX there. And magically.... the money was moved elsewhere....F U QUADRIGA! pic.twitter.com/K2AyxaRWKy

— ybrenar (@brenarchique) February 3, 2019

[Addendum: the above three tweets were added to this post on 7 February 2019, after the original publication date of the post.]

This case and a recent murder in Acapulco, Mexico reveal how tech-driven internationalism is faring as an alternative to globalism. The latter is growing out of older institutions, legal systems, governments and similar structures. The former is the Wild West: there are thousands of start-ups in the world which are trying to develop decentralized, scalable infrastructure based on block chain technology and smart contracts.

The real question is how these two worlds are contrasting and, more surprisingly, colliding. They are becoming integrated in the shadows.

The conventional assumption is that the established world is legitimate and legal and the alt-world is illegitimate and illegal. The alt-world maintains that the established system is completely corrupt, a rotten, eaten-out hulk, staffed by passive blue pills, complicit agents, and masterminds who want to impoverish and destroy the common people. Underground circles assumed that anything anti-establishment was automatically virtuous, a signpost to a new and better world. Quadriga's collapse suggests that the truth is much more murky and everything is connected.

The Revolution of Politics and Magic

Image Source: Kate's Clothing.

A new post up at my writer's blog, The Dragonfly, describes how I developed one of my fictional characters, a French psychiatrist who treats world leaders: Rémy Balthazar.

The post draws from articles I've written on this blog about the Millennial paranoia that modern politics was never based on rationalism. Rather, it was founded on the worship of rationalism, which is a different matter. If kings ruled by divine right and combined politics with religion, the modern era has depended instead on merging politics with magic.

Balthazar is an enigmatic character defined by the questions which are still raised by that revolutionary formula. Nominally secularist, atheistic and rationalistic, that model shrouds our daily lives in mystery and a yearning to know the whole truth.