As the appeal of cryptocurrency has grown, so has the opportunity for scammers to part naive investors from their money. 2019 has been no exception, with cryptocurrency and blockchain forensics company Ciphertrace dubbing it “the year of the exit scam.” Exit scams are not a new phenomenon, with a 2018 report conducted by Statis Group revealing over 80% of initial coin offerings (ICOs) in that year to have been fraudulent. Here, Cointelegraph explains exit scams and how to spot them, as well as a look at some of the biggest scams that have been discovered by various researchers. What are …

The Supreme Court of Nova Scotia, Canada, has approved over $1.6 million in fees for parties seeking funds from former Canadian cryptocurrency exchange QuadrigaCX, according to recently released court documents. Justice Darlene Jamieson ordered to approve the activities, fees and disbursements incurred by the Monitor — Big Four audit firm EY — in the ongoing proceedings of QuadrigaCX. The exchange ostensibly lost access to its cold wallet holdings following the death of its founder, Gerald Cotten, in December 2018, and now owes over $198.4 million to an estimated 115,000 users. Jamieson also approved the fees and disbursements of representative counsel, …

Coming every Sunday, the Hodler’s Digest will help you track every single important news story that happened this week. The best (and worst) quotes, adoption and regulation highlights, leading coins, predictions, and much more — a week on Cointelegraph in one link. Top Stories This Week Bitcoin falls by $1,400 after crash of major crypto exchange Coinbase After surpassing the $12,000 and $13,000 marks in a matter of hours, Bitcoin’s (BTC) parabolic run was plunged into peril when the Coinbase crypto exchange crashed on June 26. Prices began to tumble shortly before the trading platform confirmed there was a problem …

The crypto community has recently been actively discussing the fate of QuadrigaCX’s 30-year-old founder, Gerald Cotten, who reportedly died in India from a fatal disease in December 2018. However, before the apparent passing, he took virtual keys for digital wallets and moved them into cold storage. Why did this story end so tragically, and has it truly come to a conclusion? How it all began QuadrigaCX appeared in 2013 and quickly became one of the largest Canadian crypto exchanges. The platform allowed its users to get cash or cryptocurrency through an online trading service by storing digital assets on the …

The deceased owner of the now-defunct Canadian crypto exchange QuadrigaCX was allegedly transferring user funds off the exchange and using them as a security for his own margin trading on other platforms. The news was revealed in the fifth report from court monitor Ernst & Young (EY), filed on June 19 with the Supreme Court of Nova Scotia. EY has outlined its principal concerns in relation to the exchange, noting that its operations were “significantly flawed from a financial reporting and operational control perspective.” In addition to most of the activities being directed by a single individual — the now-deceased …

The United States Federal Bureau of Investigation (FBI) called for former users of the QuadrigaCX cryptocurrency exchange to provide information in an official announcement published on June 3. Earlier this year, QuadrigaCX had filed for creditor protection after the unexpected death of its founder left more than $145 million in funds apparently inaccessible. The FBI announcement asks people who lost funds due to the insolvency of the exchange in question to fill in a questionnaire asking about various details concerning their experience with the company and personal data: “If you have questions or concerns about your QuadrigaCX account, or if …

A new report from Big Four audit firm Ernst & Young (EY) outlines the assets and debts of major Canadian crypto exchange QuadrigaCX and its subsidiaries. The report was released on EY site on May 9. EY — a monitor to the creditor proceedings of now-defunct QuadrigaCX — has published a trustee’s preliminary report revealing that Quadriga has around $20.8 million in assets, and around $160 million in liabilities as of April 12, 2019. The debt and assets are spread between three subsidiary companies; 0984750 B.C. LTD. (the “Quadriga Estate”), Quadriga Fintech Solutions and Whiteside Capital Corporation. Quadriga was officially …

The April 30 indictment of two individuals on multiple counts — including bank fraud and operating an unlicensed money transmitting business — reveals an apparent connection to the shadow banking services that were used in two recent high-profile crypto exchange controversies. The indictment — charging Arizona resident Reginald Fowler and Ravid Yosef, a resident of Tel Aviv, Israel — was announced in a news release from the United States Attorney’s Office for the Southern District of New York (SDNY) on April 30. According to the SDNY announcement — published alongside an unsealed indictment document from the Department of Justice — …

Top Stories This Week NYT Reporter: Facebook Seeking $1 Billion in Venture Capital for Crypto Project According to a tweet by New York Times (NYT) tech reporter Nathaniel Popper, Facebook is reportedly looking to various venture capital firms to develop its digital token that has been previously reported on. Popper, citing unnamed sources familiar with the matter, said that Facebook is seeking $1 billion to develop its cryptocurrency project, which itself has not been publicly confirmed by the company. The Times reporter also noted that the project involves a stablecoin that would be pegged to a basket of foreign currencies …

Reddit users analyzed past Bitcoin (BTC) withdrawals from the now-defunct QuadrigaCX cryptocurrency exchange in a post published on April 10, finding that some came from other exchanges. The Reddit users claim that of the withdrawal transactions that they analyzed, one came from a HitBTC hot wallet and the other one from a Bittrex hot wallet. The users write that before they realized that the addresses are owned by exchanges, they found that some of the addresses appear on multiple High Yield Investment Programs (HYIP), amatorial ransomware research and a post concerning lost funds by another Reddit user. Further examination suggests …

Canada's major cryptocurrency exchange QuadrigaCX has been officially declared bankrupt, local media outlet CBC reported on April 8. Quadriga’s bankruptcy was reportedly approved today by Nova Scotia Supreme Court Justice Michael Wood, and follows the court monitor Ernst & Young’s (EY) recommendation that it should be declared bankrupt earlier this month. EY’s legal team then argued that the ongoing restructuring process for QuadrigaCX under the Companies’ Creditors Arrangement Act (CCAA) should shift to an alternative process under the Bankruptcy and Insolvency Act (BIA). The ruling now grants EY enhanced investigative powers as a trustee under the BIA, which means the …

Top Stories This Week PayPal Invests in Digital Identity-Focused Blockchain Startup in Apparent First Global online payments firm PayPal has invested in startup Cambridge Blockchain, a firm that focuses on leveraging the tech in order to give users more control over their digital identities. The investment, whose amount is undisclosed, is part of an extension to a Series A funding round that had raised an initial $7 million in May 2018. The United States Securities and Exchange Commission (SEC) has stated that Cambridge Blockchain raised a total of $3.5 million in new equity since May 2018. Cambridge Blockchain has notably …