Coinbase CEO: Quadriga Isn’t a Scam, It Suffered from Mismanagement
Brian Armstrong, CEO of US crypto exchange Coinbase, is confident that Quadriga is not a scam. The exchange has simply suffered from terrible management.
said Coinbase conducted own investigation into the Quadriga situation to help the crypto exchange. However, according to the CEO, the position of Coinbase should not be considered as a fact. Rather, it is just the guesswork of participants in a crypto community.Brian Armstrong in Twitter
According to Armstrong, Coinbase has defined “clusters,” which look like Quadriga's cold wallets. In June 2017, Quadriga experienced a “multimillion-dollar bug”, and then the exchange began to transfer money to cold wallets. These wallets were really controlled manually by a person and in early 2018 coins were withdrawn from the “vaults”.
Further, Armstrong argues that money withdrawn from cold wallets could be used to keep business afloat. After all, Quadriga suffered from a lack of liquidity, which was aggravated with the bearish trend in the crypto market in 2018.
As a result, the CEO concludes that at least a few people knew about the miserable state of Quadriga. They used the death of Gerald Cotten, as an excuse for the mismanagement, which resulted in losing the clients’ funds.
Armstrong also claims Quadriga is one of the oldest exchanges, that was founded in 2013. Therefore, if it was a scam, the management would choose a more “suitable time” to steal clients’ money.
In early 2019, Quadriga said that Gerald Cotten was the only one who had access to the cold wallets of the exchange, where $145 million of clients' money in cryptocurrency was kept. Therefore, this money is lost forever.