Foresight News launched a new column "Crypto Storytelling," returning to the characters and scenes in the crypto world to tell the life stories that cannot be captured in news headlines. The first issue starts with a death certificate that had a misspelled name...

Written by: ChandlerZ, Foresight News

Editor's Note: In 2026, the crypto industry was hit with a series of shocking death reports. In May, Ondo Finance founder Nathan Allman suddenly passed away; in August, Chinese crypto tycoon Harry Yeh fell from a building in Paraguay; during the same period, former HackVC partner Hsin-Ju Chuang was found dead inside a car in California, USA. Several individuals had different experiences, and some of the circumstances surrounding their deaths are still under investigation. Foresight News launched a new column "Crypto Storytelling," starting with bizarre deaths, financial scams, and life reversals in the crypto world, tracking the characters in the news to uncover hidden experiences, relationships, and the whereabouts of funds.

In the first issue, we start with Canada's once-largest crypto exchange QuadrigaCX, where the 30-year-old exchange owner Gerald Cotten suddenly died during his honeymoon in India, after which the company claimed that only he held the password to wallets containing vast amounts of customer assets. Four years later, five wallets related to the exchange transferred out about 104 Bitcoin, and Ernst & Young, responsible for the bankruptcy proceedings, denied initiating these transactions. Who had access to those wallets that were thought to be irretrievable?

After the collapse of Canada's largest crypto asset exchange QuadrigaCX, people believed that the customers' money was locked away by a password controlled by a deceased person.

On December 10, 2018, Jennifer Robertson checked out of a hotel in Jaipur, India, leaving behind a dozen teddy bears intended for children at an orphanage for the hotel to keep. The day before, her 30-year-old husband Gerald Cotten had passed away at a local hospital, and his body was waiting to be brought back to Canada.

Cotten founded what was then Canada's largest crypto exchange, QuadrigaCX, helping clients buy and sell Bitcoin with Canadian dollars and also ensuring their funds and coins were kept safe. Before he departed, on November 27, he signed a will leaving his main assets to his new wife. Arrangements were made for real estate, cars, yachts, and planes, even the care for their two Chihuahuas was included in the will.

Three days later, the couple arrived in New Delhi. They intended to honeymoon in India and afterwards attend the opening ceremony of an orphanage they had funded. On December 8, the couple checked into a hotel in Jaipur, originally booked for four nights. That evening, Cotten fell ill and was taken to Fortis Escorts Hospital.

According to a statement later released by the hospital, Cotten, who had Crohn's disease, was already in septic shock upon admission. The next day, he suffered multiple cardiac arrests and ultimately could not be revived. At 7:26 PM local time on December 9, the hospital declared him dead.

The death certificate issued on December 13 misspelled his surname as Cottan, and the staff at the orphanage awaiting the couple's arrival received an email from Jennifer, informing them that her husband had died in Jaipur and asking them to proceed with the ceremony.

A photo of Gerald Cotten and his wife Jennifer Robertson, source: Jennifer Robertson, The Independent

Cotten's body had returned home, but QuadrigaCX's clients still did not know that their boss had died.

It was not until January 14, 2019, that the exchange publicly announced the news of his death, by which time it had been a month since Cotten passed away. The company subsequently claimed that Cotten solely controlled the passwords to wallets containing vast amounts of crypto assets, and the company was unable to recover those assets. People looking to reclaim assets thus focused on the computer he left behind, hoping to find a way to recover their funds.

However, an investigation by the Ontario Securities Commission (OSC) in 2020 found a gap of approximately CAD 169 million, most of which stemmed from Cotten's fraudulent activities during his lifetime, with around CAD 115 million lost in transactions with his own clients. He filled fake balances into accounts under aliases, purchased clients' real assets, and used funds deposited by other clients to cover withdrawals. Over the years, while losing money, the exchange continued to accept new clients.

He also used the alias Chris Markay to trade with clients on his platform; through this account, he could participate in trades without putting in the principal, filling in losses from clients’ deposits after incurring losses.

Sceptre steps out of the forum, Gerry starts the exchange

In the summer of 2003, the still-in-high-school Cotten lived in the small town of Belleville, Ontario, Canada. He registered a TalkGold forum account under the name Sceptre, without revealing his age. Years later, Globe and Mail journalists Joe Castaldo and Alexandra Posadzki reviewed archived web pages and found that he had posted nearly 2,000 messages here over the next decade.

TalkGold gathered digital currency exchangers, and some sought participants for high-yield investment projects. In 2004, Sceptre's promoted S&S Investments promised short-term returns, only to face payment issues later. Archived records compiled by journalist Amy Castor show that the project website was temporarily shut down and then restored multiple times, and discussion threads were eventually moved to sections for closed or suspected fraudulent projects, while Sceptre responded to those requesting payments, asking them to be patient and wait for refunds.

One user later recalled that neither he nor other participants knew Sceptre's real name or how the project made money, but they trusted him because he was active online and posted frequently.

Ten years later, Cotten founded QuadrigaCX under his real name, helping Canadian users buy BTC with Canadian dollars or selling coins to other clients on the platform and withdrawing cash. For those looking to buy coins at the time, this exchange provided a convenient entry point.

In early 2014, journalist Stephen Hui visited the company's office on Water Street in Vancouver and saw a BTC ATM already in use, along with Litecoin mining machines. Cotten explained in an interview that users could simply scan the wallet QR code to buy coins through the machine, or recharge the platform using online banking from home. The company was running a fee-free promotion at the time, and he planned to place more trading machines across other parts of Canada.

QuadrigaCX sponsored local BTC meetups, lent its office for community events, and Gerry also helped beginners operate the machines. In a video filmed by community member Alex Salkeld, Cotten is seen teaching Salkeld's two daughters how to use the machine, one of whom was only two years old. Friends who had dealings with him introduced others wanting to buy coins to him.

As the exchange gained trust, some clients left their assets on the platform after buying coins, so QuadrigaCX long-term held their funds. The OSC later analyzed and discovered that more than half of active clients had left funds for at least 90 days. One client, who later had about CAD 200,000 that he could not withdraw, said, "I never thought such a thing would happen in Canada."

Friends and relatives could tell clients whether Gerry was enthusiastic or whether buying coins was convenient, but they could not verify the exchange's assets for them. The more money the platform held for clients, the more it needed someone to regularly check how many coins were left in the wallets, how much cash was held by payment processors, and whether the sum of the two was enough to repay clients. Behind the familiar face of Gerry, there should have been financial personnel and internal supervision to constrain how he used that money.

Early interview photo of Cotten, source: The Georgia Straight

After withdrawing from the listing plan, Cotten solely managed client assets

In 2015, Cotten and co-founder Michael Patryn attempted to push the company to go public. The two had crossed paths years earlier on TalkGold, where Patryn was also an old user of the forum. The OSC records show he had used the name Omar Dhanani. In 2005, he was convicted in the U.S. for conspiring to transfer identification documents, which involved an online money laundering service.

By early 2016, Cotten abandoned the idea of going public due to the cumbersome preparatory work, and Patryn, the chief financial officer, legal advisors, and accounting personnel then left, leaving only him as a director and executive. Faced with new contractors, he even claimed that Patryn didn’t exist at all, asserting that the stories about him online were all fabricated by competitors.

Technical, customer service, and identity verification work were handed off to contractors scattered across various locations, and they managed their own businesses remotely, while Cotten handled the financing transfers. How much financial information others could access depended on how much he was willing to disclose. One contractor described to investigators, "Everything had to go through Gerry."

Regular administrators approved or modified transactions, and the system would keep operation records, but Cotten's actions were not recorded. Ernst & Young investigators were told that it was his personal request.

Investigators later found no financial books maintained normally by the company after 2016; the platform could list every deposit, buy, and withdrawal by clients, but it could not provide accounts to verify where corresponding assets were held or how much was left. The OSC could only obtain evidence from banks, payment processors, and other trading platforms to trace QuadrigaCX's fund allocations.

Ernst & Young also found emails from Cotten inquiring about balances to payment processors, indicating that the company did not regularly verify these accounts and did not aggregate and cross-check the cash held by the payment processors, the coins on external platforms, and the money owed to clients.

When clients completed transactions on the website and received withdrawals, they could not know whether that money came from someone else's deposits. Technicians and customer service handled parts of the business, while Cotten alone allocated the funds. No one independently verified all the assets; even if he already misappropriated or lost clients' money, the platform could still operate as usual.

As early as before the listing plan was halted, Cotten had already used the name Chris Markay to buy coins. From December 2015 to February 2016, he filled approximately CAD 1 million of fictitious Canadian dollars into this account to buy about 1,700 real BTC from clients.

Clients selling coins saw Canadian dollars credited to their accounts, allowing them to request withdrawals, and the platform was obligated to pay them. However, Cotten did not use actual capital to buy coins; to cash out clients' balances, he would have to sell the coins for enough money or use other funds. If the price of coins fell and the proceeds from selling coins were not sufficient, the platform would have to cover the difference. Clients thought they had already cashed out, but in reality, they might still be unable to reclaim money due to later transactions by the boss.

Chris Markay's balance had no limits

In March 2016, QuadrigaCX launched ETH trading, and Cotten began to buy ETH using the same methods, ending with about 370,000 ETH unsold by the end of November. He also sold coins to customers using fictitious BTC balances in exchange for real Canadian dollars.

When buyers' accounts showed more BTC, the platform had to provide real coins for withdrawals. If BTC prices rose, it would require more money to replenish those coins. Cotten held large quantities of ETH while also owing clients BTC; a decline in ETH or an increase in BTC would result in losses for him.

Ordinary clients had to deposit money to buy coins, but Cotten could fill his account with balances at any time, trading with money that lacked real funding support. After incurring losses, he could also misappropriate deposits from other clients to settle with trading partners. Therefore, even if he never traded with Chris Markay, as long as clients left their assets on QuadrigaCX, they could be used to cover trading losses he'd incurred.

In 2017, with the crypto market on the rise, a large number of new customers entered QuadrigaCX, and just the BTC to CAD trading alone accumulated a transaction volume of about CAD 1.2 billion for the year, with about 30% involving Cotten's alias accounts.

One surveyed client said when selecting a platform, he would look at the trading volume, thinking that more participants meant more safety for the money. However, Cotten's accounts, which lacked sufficient principal, also contributed to the transaction volume. By looking solely at the public numbers, clients had no way to tell. New clients attracted by active trading deposited funds, allowing him to have money to continue paying existing withdrawals.

In the second half of 2017, new clients deposited large amounts of Canadian dollars; Cotten used this money to process withdrawals and also transferred coins from the platform to external exchanges to convert to cash, continuing to pay some clients.

For every deposit new clients made, QuadrigaCX owed more money. Cotten used it to pay older customers waiting for withdrawals, temporarily settling one withdrawal while still needing to repay newly deposited clients. As deposits continued to increase, he could maintain operations without revealing losses; if the influx of new money didn't match the withdrawals, he would need to find other funds to maintain payments.

The legal currency and crypto assets held by Quadriga and Cotten during the following time periods, source: osc

Ernst & Young discovered two fraudulent credits in Chris Markay's account records, one being CAD 100 million in June 2017 and another of CAD 50 million in January 2018. Cotten could use these balances to continue buying coins, but once transactions were completed, the sellers had the right to demand the corresponding CAD from the platform.

As the business expanded, QuadrigaCX found it increasingly difficult to maintain its bank accounts and relied on third-party payment processors to store and handle customers' fiat money, as well as accepting cash deposits. A leader from a BTC ATM company would bring boxes of cash. A photo included in the OSC report shows Cotten's kitchen countertop in Kelowna filled with Canadian dollars he received.

Clients could see their balances on the website but could not find out where Cotten transferred the money. From May 2016 to January 2018, approximately CAD 24 million of client funds was transferred to Cotten himself, his wife Jennifer Robertson, and the lawyer for purchasing real estate, for personal use such as buying properties. Clients' balances were not deducted, the exchange still owed them money, but the assets originally meant for payouts had already been spent on the boss's lifestyle.

Stacks of Canadian dollars in Cotten's kitchen in Kelowna, British Columbia, source: osc

Before Cotten's death, the exchange could not repay money

In 2018, as the crypto market dropped, the large amounts of ETH Cotten had previously bought started incurring losses, and the profits from shorting BTC were not enough to offset it. Clients began selling coins to exit, while Chris Markay continued to buy their cast-off coins with fake Canadian dollars. When these clients requested to withdraw their Canadian dollars, the platform had to raise more cash.

In January of the same year, the Canadian Imperial Bank of Commerce froze relevant accounts of QuadrigaCX's payment processors, causing approximately CAD 26 million in customer funds to become inaccessible. Cotten blamed the delay in withdrawals on the bank, and this real dispute made his explanation sound credible. Clients were told the platform's money was stuck in the bank, awaiting release before payments could be made.

However, even if the bank released funds, it would not cover the losses and misappropriations incurred by Cotten earlier. He used the banking dispute to explain the delays, turning the already unpayable issue into one deemed temporarily unable to be paid. Therefore, clients found it difficult to know whether their deposits were still frozen in the bank accounts or had already been lost by him.

By March 2018, the new deposits of money and coins by clients were quickly used to pay for other people's withdrawals, and the real outflow of assets had exceeded the inflow. Cotten sold the remaining crypto assets on the platform and also began returning funds that had previously been transferred to his personal accounts to the platform. From August to December, he transferred back about CAD 10 million, continuing to make payments to clients.

In early December 2018, while on his honeymoon in India, Cotten still transferred a total of CAD 500,000 from his personal account in two transactions to pay QuadrigaCX clients' withdrawals.

After Cotten's death, investigators examined wallets, bank records, and external trading accounts, discovering that large amounts of assets had already been transferred away or lost. They obtained information from external agencies to reconstruct asset accounts, gradually calculating how much the company had lost before the news of his death was publicized.

According to the calculations released by the OSC in 2020, when QuadrigaCX entered creditor protection in February 2019, it owed clients approximately CAD 215 million, with about CAD 46 million in recovered or confirmed assets. Of the CAD 169 million gap, approximately CAD 115 million was lost in platform trading, and about CAD 28 million in external platform trading losses.

A clear gap was already evident between QuadrigaCX's usable assets and the money it owed to clients before Cotten's death

In October 2019, Robertson reached an asset return settlement with Ernst & Young, returning part of the property held by her, Cotten's estate, and related companies to the bankruptcy trustee. Ernst & Young estimated that this batch of assets could be liquidated for about CAD 12 million for creditor repayment. She was allowed to keep some cash, retirement savings, a Jeep, and personal items such as her wedding ring. This arrangement was part of the bankruptcy recovery process; an April 2022 interview with her by The Independent clearly stated that she was not facing any criminal charges at that time.

In December 2022, five QuadrigaCX associated wallets that had been dormant for over three years suddenly became active. Onchain investigator ZachXBT revealed that these wallets transferred out approximately 104 Bitcoin on December 17. The batch of coins could be traced back to February 2019 when QuadrigaCX mistakenly transferred about a hundred Bitcoin into a cold wallet that the company could not access.

On December 20, Ernst & Young responded that these transactions were unauthorized and not initiated by them. Ernst & Young stated that although detailed searches had been conducted previously, they had still not found the private keys for these wallets and were investigating the transactions with the creditor representatives' lawyers. Cotten had been dead for four years, yet the coins that had been irretrievable were moved away, and the announcement did not clarify who had accessed the wallets.

In May 2023, Ernst & Young announced the first interim distribution plan, under which every CAD 100 of confirmed claims could receive about CAD 13.1, while legal fees would still need to be deducted. Balances that clients had thought they could withdraw at any time could only reclaim a small part after years of pursuit, and how much of their remaining losses could be recovered would await further claims.

In the first interim distribution plan, the allocation ratio was 13.094156%, source: Ernst & Young 2023 creditor announcement

In September 2025, the Supreme Court of British Columbia rendered a default judgment regarding Patryn's related assets, awarding 45 bars of gold, over CAD 250,000 in cash, and other properties to the provincial government. The provincial government accused him of participating in the misappropriation of client assets; he had once put forth a defense but later did not continue to respond to the case.

That year, Cotten's fraudulent entries alone caused Chris Markay's account to show an additional CAD 100 million. Clients who had paid real money had to declare claims in the bankruptcy process, with recoveries still subject to deductions for legal fees. From the halt of the platform in 2019 to the announcement of the first interim distribution by Ernst & Young in May 2023, more than four years passed, and creditors received an arrangement where every CAD 100 of confirmed claims was first allocated approximately CAD 13.1.

In Conclusion

QuadrigaCX collapsed in 2019, but the issues surrounding those controlling the exchange and misappropriating client funds did not end there.

More than three years later, FTX also filed for bankruptcy in November 2022, and the U.S. Department of Justice found that FTX founder Sam Bankman-Fried transferred client funds to his controlled trading company Alameda Research for investment, paying off debts, and purchasing properties. He also required modifications to the exchange's code, allowing Alameda to withdraw assets almost without restriction. Cotten filled fake balances into accounts under aliases, and Bankman-Fried allowed associated companies special permissions; the balances clients saw in their accounts had long since become impossible to correlate with the assets the platform actually safeguarded.

The trust crisis triggered by FTX prompted exchanges like Binance and OKX to disclose proof of reserves. In November 2022, both platforms launched relevant systems, allowing users to verify whether their balances were included in the statistics and comparing the reserves disclosed by the platforms with the corresponding client balances. Clients who previously could only listen to the platforms explain where their money was now had another way to verify.

A single snapshot of balances still could not explain how the funds were used after verification, nor did it necessarily cover all platform debts. In 2023, the Public Company Accounting Oversight Board (PCAOB) reminded that proof of reserves cannot replace a complete audit nor guarantee effective internal controls. Exchanges also need to separate client assets from company funds, limit management's authority to allocate client funds to related parties, and allow independent audits to verify complete accounts.

Seven years later, clients can see more reserve data, yet the essential questions of who has the authority to utilize their assets and who constrains that power remain old issues carried over from QuadrigaCX to FTX.