QuadrigaCX, the largest crypto exchange in Canada until it lost $190 million of customer’s money, has been closed down for over a year now but users still have not received a penny of reimbursements from the bankruptcy trustee. In fact, it appears some QuadrigaCX users are about to lose big. The trustee is turning over all customer data to the Canadian version of the Internal Revenue Service (IRS), the Canadian Revenue Agency (CRA).
The CRA has requested all of the information that QuadrigaCX has. This includes a list of accounts and wallet addresses, detailed information on all balances owed to users, and most suspiciously, user specific transaction activities and identified accounts. The QuadrigaCX trustee has complied despite plenty of dissent from the creditor’s committee.
Essentially, since QuadrigaCX was the biggest crypto exchange in Canada, this information will be a giant honeypot for the CRA. Now anyone who did not pay taxes on their crypto will probably be audited.
In a recent article on Crypto.IQ about how the Mt. Gox rehabilitation process has gone nowhere in 6 years despite holding over a billion dollars of customer funds, it was declared that Mt. Gox is a case example of how not to handle a crypto exchange hack reimbursement process.
However, perhaps QuadrigaCX is even worse, since not only is there no plan for the foreseeable future to give customers any of their money back, but the trustee is also throwing all QuadrigaCX users under the tax bus.
Based on QuadrigaCX and Mt. Gox, it seems that government run rehabilitation processes for defunct crypto exchanges are always doomed to be a failure, since the users are the trustee’s lowest priority.