Part of the CustodyStress archive of observed Bitcoin custody incidents
CS-00607
The exchange's books showed large customer liabilities that had no corresponding
IndeterminateCase description
The E&Y forensic investigation into QuadrigaCX found that Gerald Cotten had operated six 'cold wallets' that were actually empty or nearly empty. The exchange's books showed large customer liabilities that had no corresponding on-chain BTC. Cotten had been using customer funds for personal trading on other exchanges under pseudonymous accounts. The absence of any audited financial records made it impossible to reconstruct the full extent of losses.
Custody context
| Stress condition | Documentation absent |
| Custody system | Exchange custody |
| Outcome | Indeterminate |
| Documentation | Unknown |
| Year observed | 2019 |
| Country | Canada |
Structural dependencies observed
What this illustrates
There was no documentation of how access worked. Without it, there was no path back in. It's not clear whether anyone ever regained access.
Outcome interpretation
Not enough information is available to determine the outcome.
Source
Publicly Reported
Evidence type
News article
Evidence link
Related cases involving documentation absent
This archive documents observed custody survivability failures. It does not attempt to document all Bitcoin losses or security incidents.
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Framework references
Where Bitcoin Custody Intersects Legal and Fiduciary Authority
Where custody creates gaps in estate planning, fiduciary duty, and professional responsibility.
Professional Scope Boundary Matrix
What each professional or product covers, what they do not, and where gaps form between them.
The Independent Assessment Layer in Bitcoin Custody
How independent diagnostic layers emerge when multiple parties depend on shared infrastructure.
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