Cryptopia Users Will Finally Get Their Cryptocurrency Back
Apr 08, 2020 at 14:21 //
News
The story of the notorious New Zealand-based Cryptopia exchange seems to have finally come to an end. On April 8, the High Court in Christchurch arrived at a verdict that all stolen funds are a property of the company’s customers. Thus, people might finally get their money back.
The verdict was published on Cryptopia’s official Twitter page. Justice David Gendall has officially acknowledged that the cryptocurrency assets held by the company’s liquidators do not actually belong to Cryptopia, as the company was holding them on behalf of its customers. Therefore, it gives people the right to claim them back. However, as per the ruling, liquidators will have the right to charge a fee for their work on the liquidation of Cryptopia.
(1/2) Today, 8 April 2020, Justice Gendall delivered his judgement finding firstly, cryptocurrencies are “property” within the definition outlined in s2 of the Companies Act 1993 and secondly, that account holders' cryptocurrency were held on multiple trusts, separated by ...
— Cryptopia Exchange (@Cryptopia_NZ) April 8, 2020
Liquidators faced fund verification issues
The red tape concerning the funds has lasted for almost a year. Cryptopia employed Grant Thornton as liquidators in May 2019, after two consecutive hacks in January of the same year, according to coinidol.com, a world blockchain news outlet. During these hacks, Cryptopia has lost aout 9,4% of its total holdings, which amounted to $18 million.
When it became clear that the company would not be able to resume its operations in any way, their owners decided to shut it down officially. However, after the liquidators started their work, it became clear that the exchange users would not be able to get their money back this easily.
The thing was that Cryptopia didn’t arrange individual wallets for its users. Instead, each cryptocurrency had its own trust, so it was quite difficult to verify holdings of each separate customer and to tell whose money was actually stolen. Therefore, liquidators faced problems while trying to distribute cryptocurrencies back to their holders.
The latest ruling might make it easier for people to get refunded, however, liquidators are still uncertain on how much money they will actually be able to distribute among holders, as BeInCrypto reports.
No luck with investigation
While there seems to be at least some progress on Cryptopia’s liquidation and refund for its customers, the investigators are persistently keeping silent about the criminals that stole the funds.
There were reports that around $250 thousand worth of Ether stolen from Cryptopia had been on the move, there were suspicions that the exchange was hacked by someone from the inside (never underestimate offended employees). The community had even speculated that this hack was the job of infamous hackers from North Korea named Lazarus Group.
However, none of these have found actual proof or rejection, so we can only hope that the malicious hackers will be caught someday.
OhNoCryptocurrency via https://www.ohnocrypto.com/ @coinidol.com By Lana Smiley, @Khareem Sudlow