QuadrigaCX Wants More Time And A New Chief Restructuring Officer

February 27, 2019 8:56 PM

We heard from QuadrigaCX when they first filed for creditor protection at the beginning of February. We heard from the crypto community a few days later as MyCrypto founder and CEO Taylor Monahan began a string of questions related to how much cryptocurrency QuadrigaCX actually has in its inaccessible cold wallets. Then we heard from Ernst & Young (EY), the exchange’s court appointed monitor, as more of QuadrigaCX’s bitcoins were inadvertently moved and as the entities worked to fund the creditor protection proceedings.

Now we’re hearing from Jennifer Robertson, one of QuadrigaCX’s two current directors and the widow to the exchange’s deceased owner, Gerry Cotten. In an affidavit filed with the Nova Scotia Supreme Court on February 25, Robertson outlines her role as a director for QuadrigaCX during the creditor protection proceedings, her decision to ask for the court to appoint a chief restructuring officer (CRO), and the company’s request for an extension of the stay of proceedings.

According to Robertson’s first affidavit filed on January 31, QuadrigaCX appointed three company directors on January 25: Robertson herself, Thomas Beazley (her stepfather), and Jack Martel. The directors were meant to “provide instructions and directions on a go-forward basis.” In Robertson’s most recent affidavit, she states Martel has since resigned, and the third director position has not been filled.

As the legal proceedings continue, Robertson asks that the Nova Scotia Supreme Court appoint Peter Wedlake, partner and senior vice president for the auditing firm Grant Thornton, as QuadrigaCX’s CRO. Wedlake’s experience providing insolvency services and his proximity to Grant Thornton’s involvement in the cryptocurrency industry has led Robertson to believe his appointment is necessary as neither herself nor Beazley “have the cryptocurrency expertise necessary to search for or direct the search for the cold wallets.”

Speaking of QuadrigaCX’s famed cold wallets, Robertson’s affidavit also mentions that both EY and the exchange need more time to properly collect the available assets needed to fund the proceedings and pay back the money owed to the affected users. In a motion filed by QuadrigaCX on February 25, the exchange is asking for an additional 45 to 60 days. The initial 30-day stay of proceedings was handed down by the court on February 5.

If the extension is not granted, Robertson believes:

“The ability of the Companies to complete the investigation into the location and accessing the missing assets will also end, as well as ending any discussions regarding the potential sale of the assets of the Companies, namely being the trading platform of Quadriga.”

With no mention of the progress made toward gaining access to the exchange’s cold wallets, EY’s second report issued last week mainly focused on the efforts being made to fund QuadrigaCX’s creditor protection proceedings. As EY stated in their report, “The Applicants currently have no accessible funds to fund the [Companies’ Creditors Arrangement Act] proceedings, other than the interim financing provided by Ms. [Jennifer] Robertson which will be exhausted in the near term.”

Nicholas Ruggieri studied English with an emphasis in creative writing at the University of Nevada, Reno. When he’s not quoting Vines at anyone who’s willing to listen, you’ll find him listening to too many podcasts, reading too many books, and crocheting too many sweaters for his dogs, RT and Peterman.

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