Monday, February 4th 2019

Crypto Exchange Head Takes $137 million Cold Wallet Key to his Grave

by
btarunr
 Discuss (52 Comments)
In a classic case of why businesses should have disaster mitigation plans in place, Vancouver-based crypto-currency exchange QuadrigaCX has potentially lost USD $137 million in assets (customers' money), after its founder's death. Founder and director Gerry Cotten had stored the money in an offline cold wallet on an encrypted laptop and committed its password to memory. In December, Cotten died overseas of Crohn's disease, leaving the company with no other handwritten record of the laptop's password.

Crypto exchanges tend to store assets in cold wallets either on offline computers or plain paper, to avoid the wallets getting stolen on hacked online computers. The company has hired cybersecurity firms to try and decrypt the laptop to no success thus far. Cotten's widow Jennifer Robertson in a sworn affidavit to a court said that she had not found any traces of the password in their residence despite repeated and thorough searches. QuadrigaCX in addition to the $137 million under management, also holds $53 million in disputed assets.
Source: ArsTechnica

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52 Comments on Crypto Exchange Head Takes $137 million Cold Wallet Key to his Grave

#1
Wavetrex
If you ask me... this is just yet another nail in the coffin of this failed social experiment called "cryptocurrency"
But nobody asks me, so just ignore me.
Posted on Reply
#2
mtcn77
WavetrexIf you ask me... this is just yet another nail in the coffin of this failed social experiment called "cryptocurrency"
But nobody asks me, so just ignore me.
How about we lock you up and throw away the key. I find it justifiably appropriate.
Posted on Reply
#3
DeathtoGnomes
WavetrexIf you ask me... this is just yet another nail in the coffin of this failed social experiment called "cryptocurrency"
But nobody asks me, so just ignore me.
welcome to ignore ! :D
Posted on Reply
#5
mtcn77
yakkPer this example, Bitcoin is indeed unconfiscatable.
Some were claiming its value would scale along the way with its inherent scarcity. Maybe, humans aren't that foolproof the way they are...
Is my investment any less secure if no one can reclaim it? Hold my beer...
Posted on Reply
#6
FreedomEclipse
~Technological Technocrat~
The real life 'Aeolia Schenberg'
Posted on Reply
#7
Outback Bronze
Good to see the security side can actually work : )
Posted on Reply
#8
bajs11
Crohn's disease is an inflammatory bowel disease (IBD). It causes inflammation of your digestive tract, which can lead to abdominal pain, severe diarrhea, fatigue, weight loss and malnutrition.
ouch! not a good way to go
Posted on Reply
#9
mtcn77
bajs11ouch! not a good way to go
Can attest to it. He had a lot of time to reflect on his saving account.
Posted on Reply
#10
XXL_AI
"lies, greed, misery" -LP :)
Posted on Reply
#11
Metroid
cases like this makes crypto even more scarce and expensive.
Posted on Reply
#12
TheLostSwede
News Editor
bajs11ouch! not a good way to go
Suits your name though...
Posted on Reply
#13
BorgOvermind
I can decrypt that for a 9 mil special services price, taxes not included.
Posted on Reply
#14
yotano211
I can try to decrypt it for 1mil, I dont have guarantee that it will work
Posted on Reply
#15
64K
I don't know anything about encryption or if it's even possible to decrypt in this case but 137 million dollars is a lot of money. Seems like there would be some way with that much money involved.
Posted on Reply
#16
eidairaman1
The Exiled Airman
This is a reason to not trust it, he never was gonna give the funds back but use them inappropriatley...
Posted on Reply
#17
Unregistered
64KI don't know anything about encryption or if it's even possible to decrypt in this case but 137 million dollars is a lot of money. Seems like there would be some way with that much money involved.
It's a big amount for sure, but far from the biggest dormant bitcoin accounts.
#18
damian246
So far some security guys are at it.
Its not the key whats lost but the access to his laptop.
Posted on Reply
#19
Unregistered
damian246So far some security guys are at it.
Its not the key whats lost but the access to his laptop.
Seems like accessing the laptop is step 1, then they'll find out if the wallet(s) itself is secured or not. Could even be multi-signature secured which would be REALLY interesting to see them work on encryption which would be beyond banking grade.
#20
R-T-B
eidairaman1This is a reason to not trust it, he never was gonna give the funds back but use them inappropriatley...
What evidence do you have for this outlandish claim, praytell?

I used crypto this year, am I a criminal too?
BorgOvermindI can decrypt that for a 9 mil special services price, taxes not included.
No, you really can't. Trust me.
damian246Its not the key whats lost but the access to his laptop.
That's in cryptological terms, his drives private encryption "key," most assuredly. Plus any wallet encryption. No, that moneys gone.
Posted on Reply
#22
XXL_AI
put all the gpus to generate passwords for bruteforce. problem solved.
Posted on Reply
#23
srsparky32
yakkSeems like accessing the laptop is step 1, then they'll find out if the wallet(s) itself is secured or not. Could even be multi-signature secured which would be REALLY interesting to see them work on encryption which would be beyond banking grade.
you are never cracking a bitcoin wallet. the passwords are encrypted with sha256. now the odds are good that he had the password stored on a notepad file or similar because wallet passwords are really really long and complicated plus the seed recovery phrase. but if you were some person who wanted to steal somebodys wallet good luck because sha256 is 2^256 possibilities.
Posted on Reply
#24
R-T-B
XXL_AIput all the gpus to generate passwords for bruteforce. problem solved.
srsparky32you are never cracking a bitcoin wallet. the passwords are encrypted with sha256. now the odds are good that he had the password stored on a notepad file or similar because wallet passwords are really really long and complicated plus the seed recovery phrase. but if you were some person who wanted to steal somebodys wallet good luck because sha256 is 2^256 possibilities.
sha256 is a hash. It's not a passphrase. The encryption used to generate the wallets however is still pretty complex and even a GPU botnet would likely be unable to bruteforce it honestly, unless you somehow had one so big it's essentially impossible short of erm, being another bitcoin. Even then I'm not sure.

And besides...
CiTaySomething's fishy.
Seems so.
Posted on Reply
#25
XXL_AI
R-T-Bsha256 is a hash. It's not a passphrase. The encryption used to generate the wallets however is still pretty complex and even a GPU botnet would likely be unable to bruteforce it honestly, unless you somehow had one so big it's essentially impossible short of erm, being another bitcoin. Even then I'm not sure.
Immortality is impossible, for now, rest is not. I'm pretty sure they are already thinking about a solution.
Posted on Reply
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