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The Quadriga CX Story Has Become the Fyre Festival of the Crypto World

The story of Gerald Cotten’s death has quickly reached Coen-Brothers-movie-levels of plot twists. Some are calling it the Fyre Festival of the cryptocurrency world.

What else can you say about the enigmatic 30-year-old CEO of a Canadian cryptocurrency company Quadriga CX suddenly dying, and somehow taking the password to $250 million worth of crypto with him?

The story has made waves across the globe. Some are even pointing to this as an example of why crypto is not a viable currency. The same autonomy that was trumpeted as crypto’s key selling point, has now come back to bite a lot of angry people.

So what exactly is going on?


What We Know

There are very few “facts” in this case, but here is what we can (or, as close as we’re going to get) confirm.

Image courtesy of CBC News

1.  30-year-old David Cotten was admitted to Fortis Escorts hospital in Delhi with severe abdominal distress, thought to be connected to Crohn’s Disease

2. On December 14th, the company announced that Cotten had died of cardiac arrest

3. His widow Jennifer Robinson  was named the executor of his estate and swore in an affidavit that he was the only one with Quadriga’s passwords

What We Think We Know

This is where the water gets murky, and wild speculation is as rooted in fact as anything else.

Here’s what happened next: 

1. On January 16th, complaints begin to pop up on the company’s official Twitter account, citing long withdrawal delays. (Reaction level: Uh oh)

2. On January 29, Quadriga goes offline, citing unannounced system maintenance (Reaction level: Oh… Oh no)

3. The company files for consumer protection and announce, “After Gerry’s death, QuadrigaCX inventory of cryptocurrency has become unavailable and some of it may be lost.” (Reaction Level: Red Alert)

4. News outlets get word that a crypto CEO has died and taken at least $190 million worth of passwords to the grave. (Reaction Level: Mass Hysteria)

Since that time, everyone from trusted financial and tech experts to wild conspiracy theorists have published their take on what’s really happening.


And Then Things Got Worse

Gerald Cotten

You can imagine the sinking feeling of dread that anyone with Quadridge Crypto felt when this news broke. And then things got really insane.

It’s now being alleged that Quadriga Co-founder Michael Patryn doesn’t really exist, and he is actually convicted fraudster, Omar Dhanani.

… yeah. Not ideal.

Reports have also leaked that Cotten’s supposedly hopelessly encrypted laptop has been used to move cold funds after his death– even though this is the same laptop and account that is supposed to be inaccessible and holding everyone’s money hostage.

There are even questions being asked about the validity of Cotten’s actual death certificate.

The Wildest and the Most Plausible Theories

These questionable events are taking place in a new and somewhat mysterious crypto marketplace. Naturally, the Reddit community has exploded with theories about this being one of the biggest scams of the 21st century. And these theories are actually being backed by some very trusted names in finance.

Theory #1: Cotten Leveraged Crypto’s Anonymity to Pull off a Massive Exit Scam

Most of the evidence for this is speculative… but there sure is a lot of it.

Quadriga’s business as a whole doesn’t exactly scream accountability. There is no physical office and only a handful of employees. By all accounts, Cotten was a one-man show there, which is not unusual of any sort of tech start-up. But it’s also a terrible way to run a crypto business.

At the time of his death, he was in India to help build orphanages. But, some are even going so far as to say that the trip was a ruse and he fully planned to fake his own death while there and then disappear forever… Taking untold millions with him.

Cotten had signed a will only weeks before he died. This could be a red flag in most cases. However, he was suffering from Crohn’s Disease. It’s not imprudent for a young CEO with a bit of wealth to get his affairs in order, particularly if they feel a condition worsening.

However, if he was thinking about his possible death, why not put in place a protocol or procedure to pass on the crucial ledger data to someone in the company? He knew he was the sole custodian, and his death would result in exactly what we’re facing right now.

Theory #2: This Has Been Blown Way Out of Proportion

Maybe the rumours of post-death transactions from his cold wallet and his laptop are just that: rumours.

Maybe this was simply a case of a crypto-business growing too quickly for a small team to properly manage. They simply didn’t have the time or wherewithal to create the proper procedures.

This would be the best case scenario for more than 110,000 customers who are still locked out of their funds. That would mean a happy ending and resolution is still possible, even if it may be months or even years away.

Stay tuned for more as the story unfolds.