Regulator can’t help QuadrigaCX clients with lost funds

Vancouver-based firm unable to access $190M in Bitcoin after CEO with passwords died

The latest twist in the crypto drama that stranded $145 million (U.S.) in assets on QuadrigaCX brought more bad news for the investors: British Columbia’s securities regulator said Thursday it doesn’t have jurisdiction over the exchange.

The provincial agency “does not currently have any indication that QuadrigaCX, the crypto asset trading platform, was trading in securities or derivatives or operated as a marketplace or exchange under British Columbia securities laws,” Brian Kladko, a spokesperson for the British Columbia Securities Commission, said in an email statement.

“As such, BCSC does not regulate it.” Vancouver-based QuadrigaCX has been unable to access $190 million (Canadian) in Bitcoin and other cryptocurrencies belonging to its customers since its chief executive officer Gerald Cotten — who had the electronic keys to access the cache — died in December. That’s left 115,000 users scrambling to figure out how to get back their money.

The Canadian Securities Administrators, an umbrella group, published an investor alert last June urging Canadians to be cautious when considering buying crypto assets through trading platforms. The alert said a platform may call itself an “exchange,” but it may not be selling or trading securities or derivatives and, if such is the case, it will generally not be subject to regulation under securities or derivatives laws.

To date, no cryptocurrency exchange has been recognized as a marketplace by Canadian securities regulators, Kladko said.