The law firm representing Quadriga Fintech Solutions Corp. is withdrawing amid concerns about a potential conflict of interest, the latest twist to the strange story of the shuttered Canadian cryptocurrency exchange.
Stewart McKelvey, a law firm with offices across Atlantic Canada, was representing both Quadriga and the estate of its deceased chief executive officer, Gerald Cotten, who took to his grave the passwords to unlock more than US$140 million in cryptocurrencies in December.
Ernst & Young Inc., the monitor overseeing Quadriga’s dealings under a court-approved creditor protection program, had expressed concerns about the firm’s potential conflict of interest, Maurice Chiasson, a lawyer at the firm’s Halifax office, said in a March 13 letter to the Supreme Court of Nova Scotia.
"Notwithstanding that no information has been disclosed which provides a basis to conclude there has been or is the potential for conflict, we are of the view that the appropriate course in these circumstances is to withdraw from our representation," effectively immediately, Chiasson said in the letter.
The firm will continue to represent Cotten’s estate and his wife, Jennifer Robertson, he added.
The Vancouver-based digital exchange shuttered operations at the end of January, leaving 115,000 customers out-of-pocket for about C$260 million ($195 million) in cash and cryptocurrencies after Cotten suddenly died while on his honeymoon in India. The mystery around the company deepened earlier this month when Ernst & Young found that cold wallets -- the offline storage where Quadriga was expected to have held some of its cryptocurrencies -- were empty.