Cryptocurrency Exchange Loses $137 Million As Founders Takes Encryption Key to his Grave
The money was a little too secure in this case...
Published: 5th February 2019 | Source: Ars Technica |
Cryptocurrency Exchange Loses $137 Million As Encryption Key is Taken to The Grave
QuadrigaCX's CEO, Gerry Cotten, has passed away, taking with him an encryption key that only exists within his memory, making his offline "cold wallet" of digital currency inaccessible to his company, effectively losing it $137 million.
A "cold wallet" is a digital stash of cryptocurrencies that is not accessible through the internet, making it safe from digital hackers. This vault of coins is only connected to the internet when major currency transfers are necessary. These "cold wallets" can be further secured by using an encrypted notebook, keeping the files inside safe in the event of theft, making access exclusive to those who know the device's encryption key. The widow of Gerry Cotten, Jennifer Robertson, has stated in an affidavit that no traces of a written password has been found in their residence, despite repeated searches. At this time the $137 million US dollars of cryptocurrency remains unavailable.
Experts have been hired in an attempt to log into the encrypted notebook, but so far they have been unsuccessful in decrypting the device. This event showcases the pitfalls of using cold wallets to protect cryptocurrency investments.
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